Smarter Banking - Make the most of your money

Important Notice

This booklet gives information of a general nature and is not intended to be relied on by readers as advice in any particular matter.

You should consider consulting a financial adviser regarding how this information may apply to your own circumstances.

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HOW CAN I ACCESS & USE MY BANK ACCOUNT?

A young man using his laptop computer to conduct his banking transactions via Internet banking.

Once you’ve provided sufficient identification, the bank will open and activate your account and you can start using it.

USING YOUR BANK ACCOUNTS

There’s more to choosing the right account than just knowing about the types of accounts on offer and their different features. You need to know how you’ll be able to get cash, check your balance and pay bills.

MAKING DEPOSITS

Deposits into your account are likely to be of two kinds:

Regular deposits, such as your salary or wages, or government benefits.
Other one-off deposits you make from time-to-time, such as non-regular income.

Most people have their salary or benefits paid directly into their nominated bank account. To do this, you’ll need to provide your account details to your employer, or the relevant government body. You may also provide account details to other parties, such as Medicare or your private health fund, to receive medical benefits, or to companies or institutions you have investments with, to receive dividends, rental payments and other income.

You may also make other deposits – perhaps a cheque from selling something, or money you’ve received as a gift. If you deposit a cheque, you may have to wait several business days for the funds to clear and be available in your account.

MAKING WITHDRAWALS

Withdrawing cash from your account can happen in three ways:

You can make a withdrawal at a branch of the bank.
You can use the debit card that is available with most accounts to make a withdrawal from an ATM.
You may also be able to withdraw cash when you make an EFTPOS payment. An EFTPOS payment means using your debit card to pay for goods or services, for example, your groceries at the supermarket.

Did you know?

Setting up a direct debit to pay your bills can be convenient – but be sure you’ve got enough money in your bank account to cover the cost of the debit. Some companies debit your account on a regular date, every month, or once a year, which makes it easier for you to keep track of your payments. Some companies debit your account regularly, but not on the same date. If you don’t monitor your spending and the amount of money in your account you may not have enough money at the time the debit happens. If a debit results in your bank account being overdrawn, you may incur additional fees.

PAYING BILLS OR MAKING REGULAR PAYMENTS

Most bank accounts offer lots of easy options for paying bills.

If you make regular payments, such as utility or phone bills, insurance premiums, memberships or subscriptions, or mortgage or loan repayments, you can set up a direct debit, in which case the payment is automatically deducted from your account.

Other options include paying your bills electronically, using either Internet or telephone banking. Electronic payment services, such as BPay and POSTbillpay, also enable you to pay your bills at any time.

If your account offers a cheque facility, you can pay bills by writing a cheque.

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Check your statements regularly.

Check your statements regularly to make sure there are no unauthorised withdrawals.

Keeping a close eye on your bank account also helps you keep track of your spending and ensure you’ve got enough in your account to cover your expenses and any direct debits.

Check what fees you’re paying on your accounts, and see whether you can do something to reduce fees by changing your banking habits (for example, using your own bank’s ATMs instead of other banks’ ATMs).

When you travel overseas it’s particularly important to keep records of your purchases and transactions. That way, if any unauthorised transactions appear on your statements, you have documents to verify your purchases and expenses.

ACCOUNT STATEMENTS

With a range of transactions, both into and out of your bank account, it’s important to keep track of what’s happening.

Your bank will issue you a statement on a regular basis, detailing what has happened in your account since the last statement. You can see your deposits, withdrawals, and transfers, and any bank or other fees that have been charged.

Depending on your account, you may receive your statements monthly, quarterly, or at some other interval.

You can usually nominate whether you want to receive your statements in paper form, or online. Choosing the online option means you receive your statement faster, and there is no danger of it going astray in the mail – and it’s environmentally friendly.

It’s a good idea to keep a copy of your statements to help manage your finances, and to refer to when it comes time to do your tax return.

ACCESSING YOUR BANK ACCOUNT

As recently as twenty years ago, ‘doing your banking’ meant going down to your local branch, which was open from Monday to Friday. Nowadays, you can access your bank account at any time, and in many different ways, which don’t involve you going to your bank.

The table outlines some of the options available for you to access your bank account. Banks are always looking at ways to better respond to customer needs, while the fast developing world of technology and telecommunications is continually opening up new possibilities (for example, some banks now offer mobile phone banking). Ask your bank about the options that apply to the accounts that you’re interested in.

OPTION
Branch (Over the counter service)	Over the counter services are available at bank branches or bank agencies. Bank staff can help you make deposits or withdraw cash over the counter, and give you information, such as your current account balance, transaction history, fees and other charges, and details of the interest rate and terms and conditions.
ATMs (Automatic Teller Machines)	You can use your debit card to withdraw cash from your bank account, get your account balance and transfer money into other accounts. At some ATMs, you can also deposit cash and cheques.
EFTPOS (Electronic Funds Transfer at Point Of Sale)	EFTPOS terminals can be found where goods or services are sold (for example at supermarkets, petrol stations, shops and restaurants). You can pay for goods and services through EFTPOS by using your debit card, rather than paying with actual cash. At some stores, when you use EFTPOS you can withdraw cash from your account at the same time.
Telephone banking	If you’re registered for telephone banking, you can transfer money or make payments to and from accounts, get your account balance, get recent transaction information and pay bills.
Internet banking	If you’re registered for Internet banking, you can login to your account to check your account balance, review recent transactions, view your account statements, transfer money, make or schedule future payments, pay bills, open a new account or apply for a loan or credit card.
Bank@Post	Bank@Post™ is an agency banking service offered at many Australia Post outlets. If you bank with a participating bank, Bank@Post allows you to use your debit card or credit card at the post office to perform transactions, such as deposits and withdrawals, account balance enquiries, and pay bills.

TRAVELLING OVERSEAS

When you’re planning an overseas trip, you’ll need to make sure you have access to your money. ATMs are a convenient way to access your bank accounts, but not all countries have the same ATM network.

Before you travel you should make sure:

You have a four digit PIN.
You check with your bank what network or global alliance bank’s ATM and branches can be used to avoid additional fees.
Your accounts are linked correctly to your cards.
You’re aware of the foreign transaction fees that may be payable.
You’re aware that most ATMs overseas will limit the amount of foreign currency you can withdraw and charge additional surcharge fees on withdrawals.

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Travelling – make sure you can access your money

Make sure you put in place arrangements so that you can access your money before you travel overseas. It’s also worth knowing how much you can withdraw and how to avoid fees. Remember – when you’re using an ATM overseas, your account balance will be provided in the foreign currency equivalent.

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Keep your account secure

Avoid doing your Internet banking using non-secure computers, such as in an Internet café because you won’t know what security is installed on the computer. If you don’t have a computer at home, some banks have terminals set up in branches which allow customers to complete Internet banking transactions.

Did you know?

The number of bank branches is increasing. The 2008 Points of Presence Survey conducted by the Australian Prudential Regulation Authority (APRA) showed that in June 2008 banks had a network of 5,398 branches. Banks increased their branch network by 3% over the year to June 2008.

The number of ATMs is also increasing dramatically. The Australian Payments Clearing Association (APCA) indicated that in March 2009 there were 27,306 ATMs in Australia, compared to 10,084 in March 1999. There are around 2.7 times more ATMs now than there were ten years ago.

Banks operate around 46% of ATMs. Other ATMs are operated by other financial institutions or ‘third party ATM deployers’. These ATMs give you access to your account, but are not operated by your bank.

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Switching – manage your direct debits

Direct debits for regular bills can make paying bills convenient and simple. Many people have direct debit arrangements to pay regular bills, such as telephone, electricity, gas or water. But you may also have other bills that aren’t so regular, such as payments for insurances or Council rates. Sometimes we can easily forget about these irregular bills. It pays to double check old account statements when switching accounts.

Remember – check on automatic payments between your transaction account and other accounts, such as an online savings account or credit card account, and other things, such as annual memberships or subscription fees.

Direct debits are designed to make life easier for you, but if you’re having difficulties working out if you’ve got enough money in your account to cover your bills which are paid via direct debits, it might be better for you not to have direct debits for usual payments. If you don’t have enough money in your account and a direct debit makes the account go into the red, your bank will most probably charge an exception fee.

SWITCHING YOUR BANK ACCOUNT

Perhaps you already have a bank account, but are shopping around for an account that is better suited to your needs, or one that has lower fees. It’s a good idea to look around periodically to see if you can get a better deal.

Your bank will have information that can help you compare accounts. There are also websites that provide information on the accounts different banks offer, to help you find the one that’s right for you. (For more information about comparing bank accounts, click here.)

The idea of switching accounts to a different bank can be offputting – but measures recently introduced by banks have made the process much easier. These measures require both your current bank and the one you want to switch to, to help you.

Once you’ve decided on your new account, you’ll need to update any automatic payments into and out of your current account, and redirect these payments to your new account.

Automatic payments include:

Direct debits, such as to pay your bills.
Credits, such as your salary.
Regular ‘Pay anyone’ payments.

There are four steps you should follow when you switch accounts:

Step 1: Open your new account. But leave your existing account open, and some money in it to cover any automatic payments that are due during the changeover period.

Step 2: Ask your current bank for a list of all your regular direct debits and credits. The bank will give you details of your automatic payments from the last 13 months.

Step 3: Give this list to your new bank, which will use it to set up your automatic payments in the new account. Your new bank will also assist you by providing your new account details to the organisations you pay or that pay you. You and your new bank will complete a ‘Switch of Financial Institution and Account Details’ form to advise each organisation of the new account.

Step 4: After you’re sure all your automatic payments have been set up in your new account, close your old account.

Of course, if you prefer, you can identify all your regular payments yourself, and then contact the relevant organisations directly with your new account details.

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