Every quarter, it seems that the banks are earning all time high profits. Although the banks earn money in many different ways, one of the ways they earn money is through the fees that they charge to their every day banking customers. Yes, fees. Hmmm. Let me think about that one. I basically lend them money (for free!) and they charge me for that pleasure!

After that fateful day when I decided that I needed to take control of my finances, the first thing I did was look at how I did my banking.

When I was a young teenager, my mother brought me to our local CIBC branch, and I opened up a chequing account. It was one of those accounts where, if you maintained a minimum balance of $1,000, you would not have to pay any service fees. That was my one and only bank account for over 30 years! I used it for everything.

I started doing my research on all the different banks and they all offered pretty much the exact same deals. Why would any of them change? They were all making boatloads of money.

I then heard a few co-workers talking about PC Financial Banking. A no fee bank account with no limits on debits/cheques/withdrawals and no minimum monthly balance to maintain. Sounded too good to be true. Although I was a little wary, I was mad enough with my bank to give it a try.

Before taking the plunge, I decided to convert my old CIBC Chequing Account into a CIBC Bonus Savings Account. This account carries no fees (as long as I don’t make more than 1 withdrawal a month). As long as I make 1 transaction per year, the account will not go dormant. Taking this baby step left me comfortable knowing that if I needed the services of a “full-service” bank, I would still be considered a customer. I left $50 in this account and forged ahead.

I began using my PC Financial no fee bank account for my every day banking needs. My paycheques are automatically deposited there. I pay all of my bills out of this account (either through the online bill payment system or good old fashioned FREE cheques). I find their online system to be very easy to use. And did I mention NO FEES!?

Now, the great thing was that I didn’t need to maintain a minimum balance. But what was I going to do with the money that was left over? After looking at the high interest savings accounts that were available at the time, I settled on ING Direct. I set up a savings account that was linked to both my PC Financial Chequing Account and my CIBC Savings Account.

I set up 2 accounts within my ING Direct account. The first account was my true savings account. This is where I would set aside a portion of my paycheques for savings such as RRSP, extra mortgage payments, etc. The other account was what I considered my personal account. This account holds the daily money that I use to pay bills, etc…

Whenever I have a bill due that is coming out of my PC Financial account, I move money down from my ING Direct account to cover it. This way, most of my money sits at ING Direct and collects the high interest savings rate. I keep a very, very low amount of money in my PC Financial account (typically $400 for emergency cash withdrawals).

Although ING Direct no longer boasts the highest daily interest savings account (visit Achieva Financial), they are relatively competitive. The great thing about ING is that moving money between my other accounts is fast and easy. If I request that money move from my ING Direct account to my PC Financial account on a certain day, it has always been there - on time.

I have now gone 1 whole year on this system. I paid zero fees to do all my banking. Not to mention that I earned a tidy little sum from the interest that ING Direct paid ME for the privilege of holding my money.

And how about that CIBC Savings Account that I left as a safety net? I have not been back to the branch - not even one time. I have had no need of their “full service”. But, as long as there are no charges for keeping that savings account open, I will hold onto it.

It takes a lot of energy to get the old financial inertia moving. Was it worth it for me to switch my banking system? Most definitely. Will it be worth it for you? You will have to decide that for yourself.

Not only did I beat them - but I joined them as well. I own shares in Bank of Nova Scotia, Bank of Montreal and CIBC. And they have all been performing well.

NOTE: A Frugal Focus recently reviewed a few banks and came to the conclusion that PC Financial was the right choice for him.

Investing Intelligently also came to the same conclusion.