Basic Banking Habits 101

Use 10 minutes to read this blogpost, and spend 10 more minutes doing the hacks I told you and save yourself $477 over the next year! (thousands of dollars over the next decade)


ow so? By simply banishing bank fees from your life forever.

These are some of the most common fees being charged in a current or savings account.

  1. Overdraft fee

  2. Foreign transaction fee

  3. Minimum balance fee

  4. ATM fees

  5. Maintenance fee

An average Australian household gets charged up to $489 a year (Barefoot Investor, 2021).

Your goal: Reduce bank fees charged for your current account to ensure your savings are used by you and not your bank.

How to setup your first Zero-fee current account?

A typical zero fee account does not allow overdrafts (use more money than you have in your account), has zero yearly subscription fee, and does not have a minimum balance fee.

Current account vs. Savings account

A current account is a non-beneficial account which the sole purpose is storing your money with the bank.

A savings account is a beneficial account that gives the user a small interest on the balance within the account while sharing the same purpose as a current account. However, many savings account have a restriction on how much money you can withdraw a day. The main benefit of using a savings account is to earn interest on your hard-earned money.

Here is the step-by-step process to guide you to setting up your zero-fee current account:

  1. Call your bank and tell them to set up a new current and savings account for you that has “zero-fee” or “the least fee”.

  2. If your banker claims that you already hold the “least fee” account, check your monthly statements for unexpected fees.=

  3. If there are unexpected fees from your current account, do some online research on other current account options in your city. Call each of them if you have to.

  4. At the end, you want to have the best deal by having a zero-fee current and savings account.

This zero-fee account is so great that I want you to setup two of it. Nickname one of it as “Daily Expenses” and the other as “Wants”. The purpose of having separate accounts is to practice good banking habits. You don’t want to be using your daily expense account on your new iPhone or video game console.

What next?

I want you to setup another high interest online savings account in the same bank – nickname it as “Emergency”. This will serve as your emergency fund.

What is a high interest savings account?

A high interest savings account is another type of savings account that earn above-average interest on your deposits.

For example, a typical savings account interest could range from 0.1% to 1%, but a “high interest” savings account will earn you “0.5%-1.8%”. Typically, these are only offered by online banks. (ex: Monzo, Revolut, not the traditional banks you go to).

What’s the difference between online bank and traditional bank?

Online banks are banks that only offer application-based banking, which means that you can only manage your funds via computer or smartphone. The traditional bank is the most commonly used bank where you walk into the bank and make your deposit.

The benefits of using an online bank are to have 24/7 access on managing your money, without the hassle of queuing up at the traditional bank.

What if my area or city does not have an online bank?

If you are in area or city where online bank is not supported, go to your traditional bank and ask to set up a “high interest savings account”. The banker might tell you that this account limits your access because of the high-interest you can earn from it. You will tell him that you are aware of it and go on with setting up the account.

If you are in Macau like me, where online banks don’t exist, I suggest you to check out savings accounts in Bank of China. Although they are not an online bank, they have great remote service.

Reminder: Online banks and online banking are two very different terms. Online banks are non-traditional banks while online banking is a remote service typically on an app or a website that banks offer to make managing your money easier and in the comfort of your own home.

Is online banking safe?

Whether it’s an online or traditional bank, they are subject to the financial regulation which require banks to have a minimum deposit guarantee. For example, many banks in Macau guarantees up to $60,000 USD deposits. If you have exactly $60,000 in the bank and the bank goes bankrupt the next day, you are promised to get $60,000 back.

Do a quick Google search on “What is the minimum deposit guarantee” as it vary between countries.

What next?

I want you to setup another high interest savings account that is completely separate from the bank you commonly use. The purpose of this is to make this money hard to access, so you don’t spend it. Let’s call this “For future fun”.

This account is for future you, to be able to use this money you’ve saved when you retire.

The “For Future Fun” account is not a redraw facility, the high interest rate is meant to discourage you from withdrawing money from that account so easily.

What’s the takeaway for banking?

Managing money starts from your behavior. If you respect your money, in return it will respect you.

Let’s go through what have you accomplished today:

You have set up 2 current accounts:

  1. “Daily Expense”

  2. “Wants”

You have also set up 2 high interest savings account:

  1. “For Future Fun”

  2. “Emergency”

Congratulations! You are on your way to financial success.

If you are in Macau feel free to DM me if you want to know which banks I use often and other banking information!

#banking101 #business #habits #fin #personaldevelopment #finance #banking #alwayslearning #personalfinance #always #101 #finance101 #learning

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