Checking account fees, ATM surcharges, overdraft fees—those pesky bank fees can add up quickly. The good news is that these days there are so many options that you can easily avoid them. Here’s how much bank fees can cost you, and how to best steer away from them.
Checking account fees
Average Cost: $13
How to avoid them: Shop around, do your research and search for a credit union or bank that offers free checking. You can also contact the financial institution you’re currently with to see if it would be possible for them to waive the monthly checking fee. Pro tip: If you have been a longstanding customer, you might have a better chance of getting your fees waived.
Average Cost: Out-of-network ATM fees: $2.71
How to avoid them: Use ATMs that are in-network as much as possible. If you’re traveling internationally, do your research ahead of time to find out where you can withdraw funds. If you’re a member of a participating credit union, you can use any of the 30,000 surcharge-free ATM locations using your CO-OP ATM locator app or visiting www.co-opatm.org. Members of credit unions participating in CO-OP Shared Branch can also tap into the over 5,000 credit unions that are part of shared branching.
Average Cost: $32.44
How to avoid them: Look into overdraft protection, which allows you to link an account such as your savings account or credit card to your checking account. If you happen to overdraw, funds from the linked account will automatically be transferred to your checking account to cover the balance. You’ll normally be charged a fee but it will be less than what you would normally get charged if you didn’t have overdraft protection.
If you’re not aware of the low balance in your account, you may be dinged multiple times with overdraft fees within a short amount of time. To avoid that, set up text alerts to your phone when your balance reaches a certain minimum.
Minimum balance fee
Average Cost: Varies. For some accounts, it can be $15/month if you don’t maintain a minimum balance.
How to avoid them: Sign up with a bank that doesn’t charge a minimum balance fee, or sign up for an account with a low minimum balance requirement that works with your budget. Find out when you need to meet the minimum each month (i.e., end of the month, beginning of the month), and set up an automatic deposit to make sure you meet the balance.
Average Cost: $5
How to avoid them: If you don’t use your savings or checking account after a certain amount of time, you might get dinged with a monthly inactivity fee. The inactivity period varies among banks, so you’ll want to check what the inactivity period is. You can also check to see if your bank or credit union has a fee. If there isn’t one, all the better.
All those unnecessary bank fees can easily suck up your savings if you’re not careful. These days, why even bother with them? It’s definitely worthwhile to look into your options to find out which financial institutions don’t charge them. For instance, credit unions are known for charging little to no fees. If you aren’t a member yet, contact your local branch to learn more.