Bad Bank Habits You Need To Lose in 2023


Many people take a “set it and forget it” approach to banking: Once you establish a savings and checking account, you often don’t really pay attention to how you interact with these accounts.

However, you may be racking up unnecessary fees and/or missing out on ways you can maximize your bank accounts to grow your money quicker — and these habits, whether they are conscious or not, will end up costing you. Here are a few bad banking habits you should consider breaking ASAP.

Settling for the Local Branch

The closest bank to you may not be the best for your money.

“There is no reason to settle for a bank account from a location you drive by on the way to the store or school,” said Frank Trotter, president at Battle Bank. “Virtually all of your banking needs can be done on your phone, a web browser or over the phone.”

Shop around for banks that offer no-fee or low-fee accounts, as well as accounts that pay high interest.

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Not Taking the Time To Read the Fine Print

Skipping out on reading the terms of a bank account before you open it is a bad (and potentially costly) habit.

“People tend to stay with a bank once the account is open,” Trotter said, “so it’s important to take the extra 10 minutes to look at all the pertinent terms and conditions — not only at the yields and fees on the account. For example, are there things you have to do to earn the APY, like debit transactions or [maintaining] a minimum balance? Can your spouse or partner share the account? Are there restrictions on the size or number of transactions?”

Not Doing an Annual Check-In

Reading the fine print when you open an account is essential, but it’s also important to review the terms and conditions of your accounts at least once a year. Skipping this check-in is a bad banking habit.

“Things change over time,” Trotter said. “Banks lower yields they are paying on accounts relative to the competition. Fee schedules change. Banks are sold or buy other banks. Restrictions on the type of transactions or frequency are updated. It’s important to read those terms and conditions updates and make sure your bank stays in line with what you purchased when you opened the account.”

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Not Taking Advantage of Online Tools

Many of your banking needs can now be taken care of online, saving you time and potentially money. You also might be able to earn more rewards by taking care of payments digitally.

“Too often, people just keep doing what they have been doing for years,” Trotter said. “Are you paying all your bills online or by check? Can you pay with a credit card to earn miles, then pay the credit card off monthly? Can the utility or other company send you the bill online or by email? Have you linked your account and credit cards to other cash apps? Make it easy on yourself by learning about what’s new and available to you.”

Paying Overdraft Fees

“Too many banks are greedy piggies feeding off your piggy bank, so find a bank with zero overdraft fees,” said Todd Stearn, founder of “In fact, the Consumer Financial Protection Bureau reports that 9% of consumer accounts account for close to 80% of all overdraft revenue. Avoid being exploited!”

Stearn advises opting out of overdraft protection, which will make it so that the transaction is declined if you don’t have enough money to fund it, therefore avoiding overdraft fees.

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Leaving Too Much Money in Your Checking Account

Checking accounts often don’t pay interest — and if they do, it’s usually a negligible amount — so keeping too much money in these accounts means missing out on the interest it would earn in a different account.

“You’ve probably seen the news about interest rates rising,” Stearn said. “Use this to your advantage or else inflation will steal all that money in your checking account by making it worth less each day.

“Make sure your savings are in a high-yield savings account,” he continued. “For example, if you have $15,000 in a savings account that pays 3% APY, you could make about $450 in a year for doing nothing other than keeping your money with that bank.”

That’s $450 you’d miss out on by keeping that money in a checking account.

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