Australians forked out $4.33 billion in bank fees last year; cash that they could be keeping in their own pockets.
A RateCity.com.au analysis of RBA data shows people are unnecessarily handing over their money and paying fees on all types of products from credit cards and home loans to savings accounts and every day banking accounts.
Sally Tindall, money editor at RateCity.com.au, said bank fees increased by $121.7 million last year.
“Bank fees are easily overlooked but they can quickly add up to thousands of dollars every year,” she said.
“Take credit cards for example. All the annual fees, late payment fees and cash advance charges added up to $1.51 billion haul for banks last year.
“That’s an additional $93.7 million wasted on credit card fees compared with the previous year.
“Home loans fees accounted for the second largest slice of fee revenue last year, at $1.25 billion, which was $32.5 million more than we spent in 2014.
“The real shame is that these fees are largely avoidable, with thousands of fee-free options available,” she said.
For instance, RateCity.com.au data shows that while credit card annual fees range up to $1200, there are 29 cards that charge $0 fees.
Similarly, home loan annual fees can be as high as $750 yet there are 761 mortgages with no ongoing fees.
Tindall said this is a reminder for Australians to give themselves a financial health check.
“Banks rely on the fact that we set and forget with our banking products,” she said.
“Have a look at what you’re being charged and see how it stacks up to the competition – in most cases you’ll be able to switch to accounts that don’t charge any fees at all.”
The real cost of bank fees
*Source: RateCity.com.au, RBA Domestic Banking Fee Income data 2015, released June 16.
Also published on Medium.