Arvabelle
  • Make Money
    • All Career Entrepreneurship Side Hustles Start a Business Work From Home

      How to Avoid PayPal Fees: 9 Easy Ways

      10 Online Jobs That Pay $15/hr or More…

      How to Stay Productive Working from Home

      Build Relationship Capital to Build Your Business |…

      How She Became a Hair Stylist at 18

      How to Avoid PayPal Fees: 9 Easy Ways

      5 Books Every Entrepreneur Should Read

      10 Online Jobs That Pay $15/hr or More…

      7 Side Hustle Ideas to Make Extra Money

      10 Ways to Make Money Online

      10 Side Hustles to Try This Weekend

      How to Avoid PayPal Fees: 9 Easy Ways

      Build Relationship Capital to Build Your Business |…

      10 Online Jobs That Pay $15/hr or More…

      How to Stay Productive Working from Home

  • Save Money
    • All Budgeting Debt Saving

      How to Avoid PayPal Fees: 9 Easy Ways

      7 Money Lessons from The Richest Man in…

      10 Money Truths I Wish Someone Told Me…

      How to Spend Your $1200 Stimulus Check (and…

      How to Survive on Inconsistent Income

      Budgeting Tips & Template

      10 Tips to Travel on a Budget

      Pay Off Debt FAST (Snowball Method vs Avalanche…

      How to Avoid PayPal Fees: 9 Easy Ways

      7 Money Lessons from The Richest Man in…

      10 Money Truths I Wish Someone Told Me…

      How to Spend Your $1200 Stimulus Check (and…

  • Invest
    • All Investing Investing Guides Retirement

      What is a Market Order and How Does…

      What is an IPO? Initial Public Offering Explained

      What is a SPAC?

      What Are NFTs? How People Are Making Millions…

      What is a Market Order and How Does…

      What is an IPO? Initial Public Offering Explained

      What is a SPAC?

      10 Key Lessons from The Intelligent Investor by…

      The Ultimate Guide to Automate Your Finances

      How to Start Investing for Retirement

      The Easiest Way to Become a Millionaire (Roth…

      What is a 401k? For Beginners

  • Living
    • All Books to Read Minimalism Renting

      8 Important Lessons from Essentialism by Greg McKeown

      10 Key Lessons from The Intelligent Investor by…

      7 Money Lessons from The Richest Man in…

      Financial Minimalism Gone Too Far?

      8 Important Lessons from Essentialism by Greg McKeown

      10 Key Lessons from The Intelligent Investor by…

      7 Money Lessons from The Richest Man in…

      8 Important Lessons from Essentialism by Greg McKeown

      Financial Minimalism Gone Too Far?

      7 Things to Declutter from Your Digital Life

      Apartment Hunting Tips & Checklist

  • Resources
  • Shop
Arvabelle
  • Make Money
    • All Career Entrepreneurship Side Hustles Start a Business Work From Home

      How to Avoid PayPal Fees: 9 Easy Ways

      10 Online Jobs That Pay $15/hr or More…

      How to Stay Productive Working from Home

      Build Relationship Capital to Build Your Business |…

      How She Became a Hair Stylist at 18

      How to Avoid PayPal Fees: 9 Easy Ways

      5 Books Every Entrepreneur Should Read

      10 Online Jobs That Pay $15/hr or More…

      7 Side Hustle Ideas to Make Extra Money

      10 Ways to Make Money Online

      10 Side Hustles to Try This Weekend

      How to Avoid PayPal Fees: 9 Easy Ways

      Build Relationship Capital to Build Your Business |…

      10 Online Jobs That Pay $15/hr or More…

      How to Stay Productive Working from Home

  • Save Money
    • All Budgeting Debt Saving

      How to Avoid PayPal Fees: 9 Easy Ways

      7 Money Lessons from The Richest Man in…

      10 Money Truths I Wish Someone Told Me…

      How to Spend Your $1200 Stimulus Check (and…

      How to Survive on Inconsistent Income

      Budgeting Tips & Template

      10 Tips to Travel on a Budget

      Pay Off Debt FAST (Snowball Method vs Avalanche…

      How to Avoid PayPal Fees: 9 Easy Ways

      7 Money Lessons from The Richest Man in…

      10 Money Truths I Wish Someone Told Me…

      How to Spend Your $1200 Stimulus Check (and…

  • Invest
    • All Investing Investing Guides Retirement

      What is a Market Order and How Does…

      What is an IPO? Initial Public Offering Explained

      What is a SPAC?

      What Are NFTs? How People Are Making Millions…

      What is a Market Order and How Does…

      What is an IPO? Initial Public Offering Explained

      What is a SPAC?

      10 Key Lessons from The Intelligent Investor by…

      The Ultimate Guide to Automate Your Finances

      How to Start Investing for Retirement

      The Easiest Way to Become a Millionaire (Roth…

      What is a 401k? For Beginners

  • Living
    • All Books to Read Minimalism Renting

      8 Important Lessons from Essentialism by Greg McKeown

      10 Key Lessons from The Intelligent Investor by…

      7 Money Lessons from The Richest Man in…

      Financial Minimalism Gone Too Far?

      8 Important Lessons from Essentialism by Greg McKeown

      10 Key Lessons from The Intelligent Investor by…

      7 Money Lessons from The Richest Man in…

      8 Important Lessons from Essentialism by Greg McKeown

      Financial Minimalism Gone Too Far?

      7 Things to Declutter from Your Digital Life

      Apartment Hunting Tips & Checklist

  • Resources
  • Shop
EntrepreneurshipSavingStart a Business

How to Avoid PayPal Fees: 9 Easy Ways

by Suzanne Ctvrtlik April 16, 2021
April 16, 2021
*This section contains affiliate links. At no additional cost to you, we may receive a small commission from these links.

PayPal is a useful way to invoice clients, process payments, and quickly transfer money online. Unfortunately many PayPal transactions come with fees, and those fees can add up quickly.

how to avoid paypal fees 9 easy ways

What Are the Fees for PayPal Business Accounts?

If you are self employed have an online business, PayPal can be a great tool for managing your business transactions.

In order for your business to offer PayPal as a payment option, a PayPal Business Account will be required.

For online domestic (U.S.) transactions, PayPal fees are typically going to be 2.9% plus a $0.30 flat fee.

There can be additional fees for sending or receiving money internationally, so be sure to check the PayPal Merchant Fees page for current rates.

What Are the Fees for PayPal Personal Accounts?

If you are using PayPal for personal purposes, you may or may not encounter fees.

For transactions directly funded from your PayPal balance or a bank account, luckily there aren’t any fees.

However if you are funding the transaction by credit card, you will have to pay a fee of 2.9% plus a $0.30 flat fee (for U.S. domestic transactions).

How to Avoid PayPal Fees

As a business owner or freelancer, making an effort to avoid fees can help you increase the amount of money you keep from each sale or transaction. Keep reading for 9 easy ways to decrease PayPal fees:

1. Get Paid as "Friends and Family"

The friends and family option lets you send and receive money through PayPal without any fees.

This is assuming that the money is being sent from a bank account or PayPal balance.

Unfortunately if money is sent using a debit or credit card, the sender will have to pay a fee. The fee is 2.9% plus a $0.30 fixed fee for U.S. domestic transactions.

Be aware that fees can be higher for international transactions.

How do I send money using PayPal friends and family?

  1. Login to your personal PayPal account.
  2. Click Send
  3. Enter your friend’s name, email, or mobile number.
  4. Enter the amount and payment method
  5. When prompted, select Sending to a friend.
  6. Add a note (optional) and click Send Payment Now.
avoid paypal fees friends and family

Do be aware that using PayPal friends and family for business transactions is directly against PayPal’s user agreement.

PayPal does not reimburse fraudulent payment requests made through the friends and family feature. A good rule of thumb is to only use the friends and family option with people you know in real life.

2. Bill Less Frequently

PayPal charges fees for each transaction. For domestic U.S. transactions, these fees are usually 2.9% plus a flat $0.30 charge per transaction.

So, the less transactions you have, the less flat fees you’ll incur.

Although it is just a $0.30 charge, these small flat fees can add up quickly for businesses handling numerous transactions.

For freelancers, this may mean billing your clients less frequently. If you usually invoice weekly or bi-weekly, consider billing monthly instead.

Of course, before changing payment schedules with your clients, make sure that your business has enough cash on hand to handle the changes.

3. Change How You Withdraw Money From PayPal

If you usually withdraw money from PayPal using an instant transfer, you’re likely racking up unnecessary fees.

There are two easy ways to withdraw money from PayPal without fees.

Option 1: Standard Bank Transfer

By using a standard bank transfer, you can withdraw funds from your PayPal account while avoiding any additional fees.

The money you withdraw will usually take 3 to 5 business days to show up in your bank account.

How to Withdraw Money from PayPal on Desktop

  1. Login to PayPal
  2. Click Transfer Funds
  3. Click Transfer to your bank account
  4. Follow the instructions to complete the withdrawal

How to Withdraw Money from the PayPal App

  1. Login to the PayPal app
  2. Select PayPal Balance 
  3. Select Withdraw Funds
  4. Follow the instructions to complete the withdrawal.

Option 2: Use a PayPal Cash Card

Another alternative to avoid PayPal fees is to request a PayPal Cash Card.

The PayPal Cash Card allows you to use your PayPal balance for purchases online and in stores. By using your balance directly from your PayPal cash card as an alternative withdrawal method, you can avoid paying Paypal’s instant transfer fees.

These are some of the benefits of using your PayPal Cash Card:

  • Monthly fee: $0
  • Transaction fee: $0
  • MoneyPass ATM fee: $0
  • 10-Day Mobile Check Cashing: $0

4. Include PayPal Fees in Your Pricing

One of the simplest ways to avoid PayPal fees is to simply include them in your pricing structure.

By anticipating these fees, or passing the fees on to your clients and customers, you can avoid taking the hit to your pay.

For example, if you invoice your client for $500.00, PayPal fees would be $14.80, leaving you with $485.20

But, if you were to invoice your client for $515.24, PayPal fees would be $15.24, leaving you with $500.00

Use our calculator below to see exactly what you need to charge.

Alternatively, you can charge a fixed fee percentage for your services (for example, 3%). You could also ask your clients if they would be willing to cover transaction fees.

If you choose to pass these fees off to your clients, be sure to communicate this clearly.

As a business owner or freelancer, it’s important to let your clients know if their invoice will include any additional charges. Always include this information in your contracts and pricing packages.

5. Apply for Lower PayPal Fees

If you have $3,000 or more coming through your PayPal account each month, you may be eligible to apply for lower merchant transaction fees.

Applying for lower merchant fees could bring the standard 2.9% rate down to as low as 2.2%.

This is something that PayPal doesn’t advertise. You will have to contact PayPal directly to see if you qualify for lower merchant fees, and to receive the steps for applying.

6. Request Payment in a Specific Currency

Dealing with international transactions through PayPal can result in lots of extra fees.

When you are using multiple currencies, at some point a currency conversion will likely be required.

To avoid currency conversion fees, request that your clients pay in your primary currency. 

This will prevent you from paying currency conversion rates when trying to withdraw your money.

7. Accept Other Payment Methods

PayPal of course, is not the only method of receiving payment. To reduce the amount you pay in fees, it may be beneficial to ask your clients to use other forms of payment.

Direct deposit, checks, or ACH transfers are the easiest forms of payment to avoid unnecessary fees. 

Some companies and clients may be able to send your payments through direct deposit. When you receive payments through direct deposit, the money goes directly into your bank account.

By receiving payment this way, you’ll successfully avoid any fees.

Many invoicing and accounting software programs allow you to accept ACH transfers to your bank with no additional fees. This can be a great option for receiving payments from clients.

Though certainly not the fastest method, receiving payments in the form of checks is another option. Many companies won’t mind paying this way – you simply have to ask!

8. Claim PayPal Fees in Your Tax Deductions

Remember that your payment processing fees are deductible! For small business owners and freelancers, payment processing fees are usually an unavoidable part of your business operations.

Be sure to keep good record of the fees you pay throughout the year.

Although you still have to pay the fees up front, claiming any PayPal fees your tax return can help reduce your tax burden.

9. Consider PayPal Alternatives

If PayPal isn’t working for your needs, luckily there are many other options to choose from.

A few popular alternatives are Stripe, Venmo, and Google Pay.

Some of these alternative payment processors have their own fees, so be sure to compare all of your options before deciding which company works for you.

PayPal Fees Calculator


Amount $ :

Fee % :

+ Flat Fee $ :


If you invoice
${{amount | number : 2}}

PayPal Fees: ${{(fee/100) * amount + flat | number : 2}}

Left After Fees: ${{(amount - ((fee/100) * amount + flat) | number : 2)}}

If you invoice
${{(amount + flat) / (1-(fee/100)) | number : 2}}

PayPal Fees: ${{((amount + flat) / (1-(fee/100))) * (fee/100) + flat | number : 2}}

Left After Fees: ${{(amount + flat) / (1-(fee/100)) - (((amount + flat) / (1-(fee/100))) * (fee/100) + flat) | number : 2}}

FacebookTwitterPinterestLinkedinEmail
Suzanne Ctvrtlik

Suzanne Ctvrtlik is the founder of the personal finance blog and YouTube channel, Arvabelle.

previous post
What is a SPAC?
next post
What is an IPO? Initial Public Offering Explained

You may also like

7 Money Lessons from The Richest Man in...

April 16, 2021

10 Money Truths I Wish Someone Told Me...

January 10, 2021

How to Spend Your $1200 Stimulus Check (and...

February 14, 2021

Build Relationship Capital to Build Your Business |...

February 14, 2021

5 Books Every Entrepreneur Should Read

April 7, 2020

7 Money Traps to Avoid in Your 20’s

December 15, 2020

Subscribe

Popular Posts

  • How to Avoid PayPal Fees: 9 Easy Ways

    April 16, 2021
  • 8 Important Lessons from Essentialism by Greg McKeown

    March 25, 2021
  • How to Buy a Stock on Fidelity (Buy, Sell, Dividend Reinvestment)

    February 21, 2021
  • What is a SPAC?

    April 8, 2021
  • 8 Ways to Save Money in College

    February 14, 2021

our favorite investing apps




M1 Finance


M1 Finance is a commission free app that allows you to easily automate your investing.


Get a $30 bonus when you fund your account with $1000+.


Get my bonus


Robinhood


Robinhood is a commission free investing app with no account minimums.


Get 1 free stock when you sign up.



Claim my free stock


Public


Public is a social investing app with no commissions and no account minimums.


Get a $10 stock slice when you sign up.


Claim my free stock

Keep in touch

Facebook Twitter Instagram Pinterest Youtube Tiktok

Newsletter

  • © 2021 Arvabelle LLC
  • about
  • press
  • privacy policy
  • terms of service
  • affiliate disclosure
  • contact