Did you ever have to pay your bank a monthly maintenance fee because you let your checking account balance slip below a certain amount? The fee, which can run anywhere from $12-$15, might not seem so bad if it allows you to access all your money when you need it.

Advertisement

What about that early termination fee you paid your phone carrier because you had to have the latest smartphone and needed to break your contract to get it?

These fees may seem minimal in the moment, but over time, the long-term cost of those useless fees can really add up.

How long have you had cable TV? The $5.00 per month you pay the cable company to rent a modem would cost $240 over five years. You could buy a modem for about one-third of that price. There are other ways you may be spending money needlessly. You’re on the go, and need mobile internet service, but can’t always locate a Wi-Fi connection. You may be tempted to pay $20 per month for mobile access for your laptop. That is in addition to the fee you are already paying for Internet service.

Advertisement

The biggest impact of paying those fees is that you’re failing to put your money to work for your future needs, such as saving for college, providing a home for your family and investing for retirement.

Developing and maintaining a plan to achieve all of your financial objectives is a demanding challenge that you may delay taking action on. Prudential may be a good place to start: Auto Pay Analyzer. The auto-pay analyzer shows the long-term impact of setting up small monthly investments through auto-pay to help build savings for future use.  

To help you begin saving money now, here are a few tips:  

Late Payments
Late-payment fees not only wreck your budget, they have a negative effect on your credit score. Late charges on credit cards can cost up to $35 and often bump you up to the "penalty APR" of nearly 30 percent, according to Andrea Woroch, a consumer and savings analyst at Kinoli Inc. If you’re frequently paying late fees, you have a hole in your budget.

Overdraft protection
To avoid paying for overdraft protection, you need tools to help track your spending so that you’re not going over your account balance. One way to keep track of your spending is to download your bank's mobile app to track your balance and transactions.

Checking Account
Only 38 percent of major banks offered free checking, according to Bankrate's annual checking survey. You can save on fees by transferring your checking account to your local credit union, which usually offers free checking.

Credit Card Interest
To avoid any credit-card interest, you have to pay off your balance each month. You can also avoid late fee payments by setting up alerts to get email or text notifications when your bill is coming due so you can make payments on time. If you find that you unable to pay off your balance, bite the bullet and discipline yourself to start using cash, then focus on paying off your cards.

Advertisement

Early Termination
Gyms and wireless phone carriers will charge early-termination fees to keep you from cancelling your contract. You can save money and avoid cancellation fees by exploring no-contract alternatives.  

Finally, if your problem is impulse spending, try to avoid buying anything but necessities until you have waited 30 days. After a month, you may find that the urge has passed. Also, making a list before you go shopping, and sticking to that list, can eliminate a lot of impulse buys. Keeping your spending in line with what you earn will not only give you a sense of financial security but will also help you avoid debt that makes it harder to reach your financial goals.