14 fees you should never pay — & how to avoid them

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Jeanine SkowronskiFormer Head of Content at PolicygeniusJeanine Skowronski is the former head of content at Policygenius in New York City. Her work has been featured in The Wall Street Journal, American Banker Magazine, Newsweek, Business Insider, Yahoo Finance, MSN, CNBC and more.

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We won't go so far as to suggest fees are "good," but a few are worth the cost or are, at least, non-negotiable. (See: Almost every fee associated with your mortgage.) There are also fees that are total and complete money-wasters. Here are 14 fees you shouldn't pay — and some easy ways to avoid them.

1. ATM fees

Especially, especially, especially if you have an account with a big bank that has branches all over the place. Even if you don't, there's no reason to pay to access cash. If you're too far from an in-network ATM, get cash back at a store checkout counter.

2. Foreign transaction fees

You pay foreign transaction fees when you use a credit card overseas or buy something from a foreign retailer. You pay anywhere from 1% to 3% for the bank to convert that transaction to U.S. dollars. But there are plenty of no-annual fee credit cards that skip foreign transaction charges. (See the Discover it or Capital One VentureOne.) If you travel a lot, it's worth looking into one.

3. Check-your-credit report/score fees

You're entitled to one free credit report every 12 months from each major credit reporting agency: Equifax, Experian and TransUnion. You can request them via AnnualCreditReport.com. They won't come with your credit score, but you can see those for free too, via websites like CreditSesame or possibly on your credit card statements.

4. Dealer prep fees

Dealers often spring a bunch of fees on you once you've agreed to purchase a car. A few of them, like the documentation fee for processing paperwork, are difficult to get waived, but at least of one of them is almost always unnecessary. Avoid paying a "dealer prep" fee, which can costs hundreds of dollars, on new cars in particular. Getting a car primed for leaving the lot is part of the seller's business — and requires minimal effort.

5. Mutual fund sales load fees

"Sales load" is investment jargon for a commission paid to a broker. Mutual funds offer them as incentive for brokers to sell their shares over others, but, weirdly, they pass this charge off to you, the investor. They take a percentage of your investment, either when you purchase fund shares or when you redeem them. But there are plenty of no-load mutual funds or alternative investment vehicles that perform the same way, so you can skip this fee by opting for one of them instead.

6. Card payment fees

Often billed as a "convenience" fee by service providers who would prefer you didn't pay via credit or debit card. The fee isn't totally egregious. Financial institutions charge providers swipe fees when they take plastic. But you certainly don't have to eat it. If you're charged a payment fee for paying your utility bills or parking tickets, opt for a check or checking account transfer instead.

7. Late fees

At least not out of forgetfulness: Set up your bills to auto-pay or, at the very least, sign up for alerts to remind you a payment is coming due. It'll spare damage to your credit score, too.

8. Credit card cash advance fees

Mostly because you should avoid ever doing a credit card cash advance, effectively an uber-high-interest loan against your credit limit. On top of being sky-high, interest starts accruing the minute you use your credit card like a debit card and the upfront fee is often as much as 5% of the amount you're advancing.

9. Overweight baggage fees

Airline baggage fees are generally unnecessary: There are easy ways to bypass them. For instance, you can fly an airline that doesn't charge for luggage, pack a small enough carry-on or leverage an airline credit card that lets you skip the charge. If none of those options work, at least make sure you know your carrier's limits. An overweight bag can cost as much as $100.

10. Booking fees

Some airlines still charge a fee if you book over the phone or in-person. It's generally around $15 and is easily avoided by booking online or via the carrier's app.

11. Paper statement fees

Financial institutions want you to go green — digital statements are cheaper — so some banks now charge for paper statements. The fee's usually only a dollar or two, but do yourself and the environment a favor: Get your monthly statements via email.

12. Shipping fees

First off: Amazon Prime. Yes, you pay for a subscription, but if you order stuff online all the time, the $99 annual membership fee can pay for itself. Second, you can avoid standard shipping fees by meeting a retailer's minimum or finding a coupon online.

13. Overdraft fees

Overdraft fees have gotten less attention since a law passed in 2010 prohibited banks from automatically opting into their overdraft protection services (essentially when they "cover" a transaction even though there isn't enough money in your checking account). But their star is, unfortunately, on the rise. A new report from Moebs Services found Americans paid $34.3 billion in overdraft fees in 2017, the most since 2009, per MarketWatch. These fees average $30 a pop, so make sure you've opted out of the program and sign up for free low-balance alerts instead.

14. Over-the-limit fees

Some issuers offer a credit card version of overdraft protection. You have to opt in for this "service" too, but if you have, the issuer lets you charge over your credit limit — for around $25 to $35. These fees are totally avoidable. Just make sure you haven't opted in. Staying well under your limit is a good idea, anyway. Maxing out credit cards is really, really bad for your credit score. We've got a crib sheet for fixing your credit right here.

Image: Nastia Kobzarenko

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