March 26th, 2021
While people may appear to be swimming in bills, debts, expenses, and fees, they are in fact drowning.
Consumers are the most stressed at the end of the month (39%), as well as the day before credit card payments (38.9%) and rent (37.91%) are due, according to a recent survey of more than 2,000 Americans. The survey, conducted by OnePoll on behalf of Cushion, revealed that ATM fees (38%), overdraft fees (33%), foreign transaction fees (29%), and credit card interest charges (26%) are the most common bank-related penalties that induce stress.
In the past year, Americans have been forced to double down on their finances by working harder to save (even in the most minute ways) and adjusting their spending to accommodate an ongoing global pandemic. While saving and adjusted spending are top priorities for many people right now, they first have to address the most pressing issue: acknowledging their account balances.
The Battle with Balances
After a year of layoffs, furloughs, pay reductions, medical bills, and emergency spending, that anxiety has only heightened for a number of people. Living through the pandemic has made 60.79% of people feel worse or much worse when checking their bank account balance.
Much like bank account balances, credit card balances weigh heavily on consumers. In total, three out of four people worry sometimes (32.57%), often (26.78%), or constantly (14.61%) about being able to make the minimum payment on their credit card, explaining the one in three people who dread the day their credit card payments are due.
TIP: Set up notifications on your checking account to alert you when your balance is low. To cut down on the worry of credit card minimum payments, try paying small amounts throughout the month to avoid a larger payment all at once.
Checking Account Woes
Although ATM fees only account for 2.5% of the fees that Cushion detects on users accounts, the burden is far greater for consumers. People lose $48.31 per year in ATM fees, and they’d go up to 16 minutes out of their way if it meant they could avoid a fee.
TIP: To avoid or lessen ATM fees, visit your bank’s partner ATMs, use a fee-free ATM, or choose cash back when using debit cards at grocery and convenience stores.
Overdraft fees, on the other hand, account for more than half of the fees that Cushion detects on users’ accounts. Approximately 31% of people experience frequent close calls, according to the survey, where they don’t know whether or not they have enough money in their account to cover an upcoming expense. Those close calls end in overdraft fees one in three times.
TIP: To avoid overdraft fees, keep a close eye on your account balance and charges, sign up for low-balance notifications, or reassess your overdraft protection status.
Anything to Save
When negotiations fail, some consumers have learned that it could pay off to reevaluate their personal and spending habits. Three out of four people would be willing to go out of their way some or all of the time if that meant they didn’t have to pay a toll, fee, or surcharge. For 50% of people, COVID-19 has made them more willing to go out of their way to avoid fees than they were before.
TIP: Spending less money — or reducing waste — is one of the most effective ways to improve your financial situation. This could mean negotiating down your internet bill, monitoring your electricity bill to see where you could save, or adjusting your overdraft protection to better align with your spending habits.
The first step to overcoming fear related to finances is starting, whether that means analyzing your bank account history to create a budget or finding little ways to save money across your bills.
“People tend to shy away from negotiating bills and fees because it can be time-consuming and exhausting,” says Cushion founder and CEO, Paul Kesserwani. “As a result, they leave money on the table. Most things are negotiable. Banks, retailers, and billers would rather give you money back than lose you as a customer altogether.”