How to save a quick buck
by Andrew on 19/02/07 at 3:33 pm
5 comments
Most people don’t really think about specific bank charges, or what to do about them. We all know that banks charge us a lot, but usually it appears as one big ca-tching at the end of the month, and there’s no clear strategy for how to decrease it.
Well, here’s a quick tip: use your credit card for debit orders, instead of your cheque/savings account. Did you know that debit orders (such as cellphone accounts and insurance premiums) cost you about R10 to R20 every time. Usually those costs don’t appear on your internet banking statement, but you’ll probably pick them up on a full paper statement. If you switch those debit orders to come off your credit card, it usually costs you nothing. Zip.
We’ve just moved our company insurance policy to Outsurance, and when it came to the payment part they asked for a bank account for the debit. We asked if it could rather come off our credit card, and they said yes, and there is no extra charge.
So here’s your homework: find your bank statement and highlight all the debit orders that come off. Phone each of those companies, tell them your bank details have changed, and give them your credit card information. Then drop me an e-mail inviting me to lunch, because I’ve just saved you a few thousand rand over the next year.
Andrew Smith is the pedantic systems guy behind Live Alchemy, a SA e-commerce company. Andrew writes for Ideate in an attempt to make the world a more efficient place. View more articles by Andrew.
Tags: company insurance
Karin
Feb 19th, 2007
“Then drop me an e-mail inviting me to lunch, because I’ve just saved you a few thousand rand over the next year.”
Hmm, think you have overlooked 1 particular item in this: costs for retailers/companies etc who are paying your fee to the credit card companies. We ‘refuse’ credit card payments or add 3% on top of the price, becuase that’s what the cc-company will charge us. Debit card use costs us also, a fixed amount per transaction, nothing major and in the light of the average amount the customers pays 9 times out of 10 ‘peanuts’.
Your savings tip is a temporary one I think: most companies will adjust their ‘normal’ prices to include the rising costs of credit card payments
Now you can invite me to lunch
Andrew
Feb 19th, 2007
I’m not denying that using a credit card costs the retailer money, but everyone I have tried so far (insurance, 2 cellphone companies and a hosting company) have happily changed from a debit off a cheque account to a credit card, at no extra charge. Some of them might catch on and stop this service, but a highly doubt that will happen any time soon, at least not before you’ve saved enough to pay for that lunch.
On our retail sites (like YuppieChef) we have budgetted in the price of the credit card fee. We don’t penalise customers who choose to pay this way, and it seems like our service providers don’t either.
Karin
Feb 19th, 2007
Oh I know, this adeptation to credit card costs has just started over here (UK) and more and more companies do let you know that paying by credit card (versus Direct Debit or Debit Card) is going to cost you in order not to ‘penalise’ customer who pay in a different – cheaper – way.
In the end everything will ‘catch-up’ I think and reaches cost-balance
James
Feb 20th, 2007
I’ve done the same thing with my Cellphone bill. Because of my work, I phone overseas quite a bit on my cell phone, so I changed my debit order to my credit card for 2 main reasons:
- I get the points/miles/ebucks even though my company is refunding me
- If it’s a really bad month, my bank account isn’t emptied. Though this shouldn’t be an issue if I claim on time.
belinda
Aug 10th, 2007
hello
i recently came across a great site that looks to clear up this banking charges nightmare.
its called thinkmoney.co.za and its got a great personalised calculator that allows you to work what products are best suited to you based on your spending profiles…
i found the site very useful
bel