(MONEY Magazine) – Ever been misled by a bank ad? Baffled by how interest on a certificate of deposit was calculated? Socked with an undisclosed fee? The new Truth in Savings Act can help. The legislation, which takes effect on June 21, forces banks to standardize the way they express interest rates, to disclose many fees and to make advertising more informative. Although welcome, the new rules regrettably still leave room for banks to take advantage of unwary customers. ) ''Sure, it's a victory for savers, since banks will be forced to be more forthright,'' says Richard Morse, professor emeritus of family economics at Kansas State University. ''But it is an incomplete victory.'' Here is how the act affects bank practices in three key areas -- and how you still must protect yourself. Interest rates. To help consumers comparison shop, all banks will have to state the interest rates they pay in the same way -- as the ''annual percentage yield'' (APY). The APY will tell you how much you would earn if you left your money on deposit for one year at that rate. All you need do is multiply the APY times your principal: For example, if the APY is 4%, your $1,000 would grow to $1,040 after one year. The APY is meant to eliminate the confusion caused when banks apply different methods of compounding and use such varying terms as effective yield and simple interest. The act also outlaws some truly outrageous bank practices. For example, some banks, especially in the South, do not pay interest on the full balance in interest-bearing checking accounts. Their reasoning: Since banks earn no interest on the reserves that federal regulations require them to set aside (currently 10%), they deserve to make up that loss by eliminating interest payments on a like percentage of customers' deposits. ''It's an absurd argument that's been used to rip consumers off for years,'' says Edmund Mierzwinski, program director of the U.S. Public Interest Research Group in Washington, D.C. The act requires banks to pay interest on all funds in interest-bearing checking accounts, thank you very much. Another sneaky interest-rate trick banned by the new law: the ''low balance'' calculation. Many banks require you to maintain a minimum balance in your checking or savings accounts to earn interest. Fair enough. But some banks cancel an entire month's interest if your balance slips below the minimum even once. That practice will be illegal now as well. Unfortunately, the Truth in Savings Act does not put an end to a third annoying technique. Today about 10% of all banks do not start paying you interest on a check until it clears, usually one to three days after you deposit it. The Federal Reserve, which is responsible for putting the act into effect, proposed an amendment that would have discouraged this practice but then backed off; as a result, some industry experts predict that even more banks will start delaying interest. Your only defense: Ask the bank to explain its policy and deal only with banks that pay you interest from the day of your deposit. Fees. When you open an account, or just ask about one, banks will be required to give you a list of fees for such items as stop-payment orders, bounced checks and certified checks. But they need not mention certain other fees, including those for wire transfers, which can run as high as $40. So ask about all fees before you open an account. Advertising. Banks will be prohibited from calling their accounts free or no cost if you must maintain a minimum balance to avoid fees. Be warned, though: The act hands bankers the right to tout ''free checking'' in ads when the account is free for a limited time (the ad must note that, however). Also, the Fed agreed that signs in bank lobbies do not have to follow the rules for bank advertising. So don't believe everything you read -- in bank lobbies, at least.

CHART: NOT AVAILABLE CREDIT: Veribanc CAPTION: THE BEST SAVINGS YIELDS IN THE U.S.

CHART: NOT AVAILABLE CREDIT: Source: Bank Rate Monitor CAPTION: THE BEST CREDIT CARDS IN THE U.S.