5 rules of thumb on: managing your bank account

1. Switch to a fixed monthly fee fee plan

Savings potential: tens of hundreds of shekels per year

Important information:

The banks offer commission tracks in which the monthly payment to the bank is fixed. Each bank has a “basic commission track” and an “extended commission track” and the bank may offer an “expanded plus track”.

The costs of the basic and extended plans range from: NIS 8.5 per month to NIS 30 per month, the cost depends on the number of transactions performed in the account and varies slightly from bank to bank.

What should be done?

• Contact your bank and ask for a breakdown of the fees you’ve paid in the past three months. This breakdown can also be seen on the bank’s website.
• Summarize the number of actions you performed each month with a clerk and the average number of actions you performed through a direct channel.
• Go tothe calculator and check which route is right for you and how much it costs. You can use a banker to choose the route.
• Go to the track that suits you, you can do it on the bank’s website or through a bank teller.

2. Reduce the number of transactions you do through a “direct channel” at the bank.

Savings potential: 4 NIS per direct channel action you reduce

Important information:

The transactions carried out at the bank are divided into two types:

Actions by a teller: Actions performed through a bank clerk, including through a staffed call center, including: cash deposit, cash withdrawal, production and delivery of a printout at the request of a customer, transfer or deposit to another account, check redemption (including self-check withdrawal), check deposit (per check group – up to 20 checks), voucher payment, cash itemization.

Direct channel transactions including: credit of an account through a clearing house, debit by credit card, cash deposit, cash withdrawal by automatic machine, transfer or deposit to another account, voucher payment, information query on any subject (starting from the seventh query of the month), check withdrawal, check deposit (for each group of checks – up to 20 checks), including through a service box, debit by authorization to charge an account or a standing order.

The transactions performed by the bank teller cost you more. About 4 NIS more than the same action will cost on a direct channel.

What should be done?

• Perform actions through a direct channel and not with a clerk at the branch / phone, save money and do not wait in line.
• Centralize operations, fewer operations, less costs. For example, reduce the number of times you withdraw cash each month, concentrate your smoothie deposit.
• Keep track of your account’s financial transactions.

Important information:

Checking your bank accounts regularly will reflect your exact situation, help you detect errors in your account and allow you to prepare for expected expenses and prevent unpleasant ‘surprises’.

You can keep track of your account by connecting online to your online bank account. The “Email Messaging” service will allow you, if you join it, to track messages and letters that the bank sends you electronically. Notices will be received in a personal and secure e-mail box on the bank’s website. You can also use the service offered by some banks to receive real-time alerts and messages to your mobile device.

What should be done?

• Check once a week or two the movements that are mandatory and those that are credited. You can do this by connecting to your bank account on the bank’s website. You can also use the service offered by some banks to receive real-time alerts and notifications to your mobile device.
• Check the fee payment and fee plan adjustment if you choose one.
• If you find an incorrect charge, credit or unclear fee, contact your bank or service provider for an explanation.

1. Improve bank conditions: credit, loans, mortgage and savings

Savings potential: tens of thousands of NIS

Important information:

The changing market conditions, your changing financial situation, and competition between the banks are factors that affect the terms you received at the bank: on the payments side are, among other things, the commission you pay on the credit facility, the interest on the overdraft if you have one, the interest on the repayment of a loan you took and the mortgage payments you pay every month for many years. On the savings and investment side, you receive interest on savings and are charged commissions on investments. Testing each of the services and may and better adapting it to your needs from time to time can save you a lot of money.

Possible “cards” to bargain for better terms at the bank:

• Low level of risk – the bank charges you interest rates according to the level of risk it attributes to you as a customer. If you haven’t exceeded the limit, haven’t missed mortgage payments or loan repayments in the past, haven’t returned checks, then as far as the bank is concerned, you’re at a low risk level and deserve a lower interest rate.
• If you prove to the bank that you are in the process of recovery and balanced for several months, even if in the past you were a high-risk customer, the bank will usually be happy to come to you. Keep in mind that the bank also wants to see its money back.
• Other assets under the account: study fund, deposit, savings. When the bank has assets and not only your risk liabilities as a customer, from the bank’s point of view, decreases, and accordingly, the conditions you can receive improve.
• Show attractive offers from other banks or nonbank entities.
• Shorten the duration of the loan to the minimum period you can meet in terms of monthly repayment (reduces the interest amount, not the percentage amount).
• Provide collateral / guarantors for the repayment of the loan.

What should be done?

1. Decide that you are allocating time to improve your conditions, it involves work but the savings are significant.
2. Know how much you’re paying and what to use in: loan and mortgage settlement reports, periodic commission reports, your bank statements.
3. Conduct market research periodically, contacting another bank on any of the issues will allow you to receive competitive offers.
4. Work to improve conditions with the bank or switch to another bank.
5. Consult professionals. In order for you to get the information you need to make a decision, ask for it. Insist on getting clear information at the bank, ask until you understand, and consult professionals as soon as necessary.