Trimming fees on banks, credit cards, phones

NEW YORK (CNNMoney.com) -- Most of us are dealing with mountains of debt but there are some ways we can cut the fees we pay. Following are areas where you can save money by lowering those annoying expenses.

Watch out for mutual fund fees. They're eating into your returns big time. We're talking hundreds or thousands of dollars here. To figure out what you're paying, look at the fund's expense ratio. This ratio tells you what percentage of your account is being siphoned out for expenses each year.

So if you have $50,000 in a fund with a 2 percent expense ratio you'll pay $1,000 in fees every year. You can cut down the expenses by moving your funds to low-cost companies.

Here are some examples of companies that have cut their fees the most: Fidelity, Vanguard, Dodge & Cox, T. Rowe Price and Janus Funds, according to Morningstar.

The more expensive funds generally perform worst. As a general rule, you should keep fees below 1 percent for a stock fund and below 0.75 percent for a bond fund, according to Christine Benz of Morningstar.

From overdraft charges to ATM fees, bank fees are on the rise. Here are some ways to beat those fees. First of all make sure you opt out of "courtesy overdraft protection": If you don't, you'll be hit with a $20-$35 overdraft fee each time you overdraw.

Instead, ask for an overdraft line of credit. This charges you interest only on the amount and for the days you are overdrawn. Or you can link your checking account to your savings account.

And while there's not a lot you can do about ATM fees, you should consider a bank that has a large ATM network, or at least find a bank that has locations near where you live or work. And recently, some banks are even waiving fees to attract customers.

Just last week lawmakers challenged credit card execs over rising late fees and other dubious penalties and practices. Right now late fees are over $30 and penalty interest rates can be up to 30 percent in some cases. And while congress hashes out what can be done to protect the consumer, there are some steps you can take to avoid these fees. First, automate your payments online. You can even set up your payments months in advance.

But, if you know your payment is going to be late, you may be able to avoid a late payment fee if you call ahead. Credit card companies may offer this kind of favor in some circumstances.

The problem was, he didn't realize he had even purchased this service. It was added on when he upgraded his cell phone handset. The bottom line here: whenever you're upgrading your handset or your service, make sure you scrutinize your bills even more carefully.

---------------------------------

Credit checks, credit cards and passports

How to save on your winter electricity bill

President Bush's new healthcare plan

Gerri's Mailbox: Got questions about your money? We want to hear them! Send e-mails to toptips@cnn.com or click here - each week, we'll answer questions on CNN, Headline News and CNNMoney.com.