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Here's How To Avoid Paying Hidden Charges

Hidden charges can be enraging. Money guru Joe Ferreria tells you how to keep your cash where it belongs: in your wallet.

“Minor” fees are more than annoying—they can cost you major pesos. But these small steps could help you pocket that money instead. And if you’re still being asked to pay unfair charges? Use to find an alternative credit card company, bank, or insurance provider, then switch. Just make sure you don’t get stuck with a termination fee in the process.

P15 at the ATM

Say you take out cash twice a week from the out-of-network ATM right by your office because, hey, it’s convenient. It’ll add up to P120 a month or P1,440 per year.

SAVE IT. It’s worth choosing a bank with ATM locations near you, but if that’s out of the question, find out whether your bank is affiliated with Megalink, BancNet, or Expressnet. Withdrawing from a bank under the same consortium as your account’s should make you spend less than if you take money from a different bank.

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P140 monthly service fee

Traditional insurance plans will let you decide between a one-time annual payment or smaller monthly payments for the premium. Beware: If you opt to pay monthly, you may also get smacked with a monthly service fee.

SAVE IT. Traditional policies charge monthly additional fees of up to 10 percent per year. If you don’t have enough cash on hand to pay for insurance in a lump sum, start putting aside a small amount each month so you’ll be ready when next year rolls around.

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P300 for “maintenance”

Some banks charge you for not having enough money in your account, which forces you to keep the maintaining balance. A similar burn: being charged with annual fees to keep your credit line even though you don’t use it often. Get hit with one of these fees each month? You’re out P3,600 that year.

SAVE IT. If you don’t use your card enough to maximize the limit, some companies will actually reduce it, thereby decreasing the annual renewal fees. To lessen the financial burden, ask them to deduct the annual fee of your credit card from the reward points you accumulated.

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P2.5K bounced check fee

If you happen to skip funding your check payment, your bank is happy to cover for your mistake…but charges you for the favor. Most banks charge a minimum of P2,500 for checks that bounce within the day, but if it bounces at the end of the week, you’ll have to pay P2,500 per day, including Saturday and Sunday.

SAVE IT. Enroll your checking account to an overdraft protection facility like BPI’s Check Protect, which allows you to nominate a second checking or savings account or a credit card from which your check can draw funds. You can also sign up for the mobile banking facility so you can transfer funds from your savings to checking account with just the swipe of your finger.

P600 late card payments

Forgot to pay your credit card bill on time? That could snowball into a huge credit card debt.

SAVE IT. Some international banks are more forgiving if it’s your first offense, so you can ask them to waive it, provided you have a good reason for the late payment. But if you’re a chronic bill skipper, set up monthly reminders for bill payments and pay your dues before the bill even arrives so you don’t have to deal with the hassle afterwards.

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This story originally appeared in Cosmopolitan magazine, January 2014. 

* Minor edits have been made by editors