You will be able to find every fee and interest line on a bank statement and check whether bonus interest was paid.
Marcus is 29 and works in sales for a logistics company in Paya Lebar. Last year he moved his savings to an account that advertised bonus interest if he credited his salary, spent on the bank's card and paid three bills by GIRO. He did all three, or thought he did. When he finally opened a statement, months later, the interest line said S$0.83. He had expected something closer to S$34 a month.
Bank statements are short, and most people only look at the balance. The lines that cost you money, or the lines that should be paying you and aren't, are easy to miss because they're small. This lesson shows you where to look.
Most bank fees are charged for something specific, and the statement names it, often in an abbreviated form. The common ones are:
a fall-below fee, charged in a month when your average balance drops under the account's minimum an account service charge or annual fee, on some accounts and for some customers cheque fees, for issuing, stopping or returning cheques overseas transfer fees, for sending money abroad by telegraphic transfer, often with a separate charge from the bank at the other end
Fall-below fees are the ones most people pay without noticing, because they hit in exactly the months when money is tight. A fall-below fee is charged monthly, so an account that sits below its minimum all year can cost you twelve fees before you see one.
Each fee usually appears as its own line with a short description and a date. When you see one, find out what triggered it and whether it will happen again. The bank's fee schedule, on its website, lists every charge and its current amount. Don't rely on an amount from a friend or an old statement, because banks revise their fees.
Interest on a savings account is usually credited monthly, at the end of the month or early in the next one. On accounts with bonus interest, you'll often see two or more separate lines: one for base interest on the whole balance, and one or more for each bonus you qualified for.
How money works, in lesson 1.2, How a bank earns the interest it pays you, showed why a headline rate is rarely what you earn on your whole balance. The statement is where you see what you actually got.
Here's Marcus's month with example figures. Say his account paid a base rate of 0.05% a year on his S$20,000 balance, plus a 2% salary bonus. These rates are made up for the example. The base interest for one month is S$20,000 times 0.05%, divided by 12, about S$0.83. The salary bonus for the month would be S$20,000 times 2%, divided by 12, about S$33.33. His statement showed the first line and not the second.
When a bonus line is missing, the cause is almost always a condition you didn't meet that month, even if you thought you did. Typical conditions include crediting your salary, spending a minimum on the bank's card, paying a number of bills by GIRO, or keeping your balance above a level.
Each has fine print. Salary crediting often counts only if the payment arrives through a particular channel with a particular code, so a salary paid by an ordinary transfer may not count. Card spend may exclude some transaction types. Bill payments may need to be GIRO arrangements rather than one-off payments.
Marcus called the bank. His employer paid salaries by a normal bank transfer, which the bank didn't treat as a salary credit under its terms. Three months had passed, so with the example figures he'd missed about S$100 of bonus interest. He asked HR whether payroll could pay through the channel the bank accepted, and checked the next statement to confirm the bonus line appeared.
The account's terms and conditions set out each condition exactly. Read them once with your statement beside you and tick off each condition against what you see.
Fees and terms change, and banks give notice when they do. That notice may come as an email, a message in the banking app, a line on the statement or a separate letter. Most people delete it.
Read them. A notice might tell you a fee is going up, a bonus rate is going down, or a condition is changing. Any of those can turn a good account into an expensive one without you doing anything differently. When a notice arrives, compare it with the bank's current fee schedule and your own habits, and decide whether the account still suits you.
Reading a bank statement for cost comes down to three questions for every line that isn't a deposit or a spend. What is it? What caused it? Will it happen again? A fee with a cause you can remove is money you can stop paying. A missing bonus with a cause you can fix is money you can start earning.
Three months of statements is enough to see a pattern, such as a fee that hits every month or a bonus that only arrives sometimes. Download them from your banking app as PDFs and have them open before you start the activity.
Go through your last three bank statements and list every fee and every interest line, with the amount and the reason.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).