Banking & Savings

Bank Fees and How to Get Rid of Them

Almost every routine bank fee has a no-fee alternative, and most are waived on request.

Most fees on a US checking account are avoidable. Some are waived automatically if you meet a condition, some are waived when you ask, and some exist only because you are at the wrong bank.

Monthly maintenance fees

A standing charge, commonly $5 to $15 a month, for holding the account. Banks waive it when you meet a condition: a minimum daily balance, a recurring direct deposit, a set number of card transactions, or holding another product with the same bank.

Call and ask which waivers apply to your account. If none fit your situation, plenty of online banks and credit unions charge no maintenance fee at all and impose no conditions.

Overdraft and non-sufficient funds

The most expensive category. Overdraft fees apply when the bank covers a transaction that exceeds your balance. NSF fees apply when the bank declines it. Either can run $30 or more, and some banks charge multiple times a day.

Several options exist and banks rarely present them clearly:

• Decline overdraft coverage on debit card transactions. Your card is declined instead of approved with a fee attached. This is your choice under federal rules, and opting out costs nothing.
• Link a savings account. The bank pulls from savings instead, usually for a small transfer fee or none.
• Switch to an account without overdraft fees. Many banks now offer these, often with a grace amount or a grace period before any charge.
• Set balance alerts so you know before a transaction fails rather than after.

ATM fees

Using another bank's ATM can cost you twice: a surcharge from the machine's owner and a foreign ATM fee from your own bank.

Options: stay inside your bank's network, use a bank that reimburses ATM fees, take cash back at a store checkout, or use a credit union in a shared branching network, which gives access to thousands of machines fee-free.

Wire and transfer fees

Domestic wires typically cost $15 to $35 outbound and sometimes an inbound fee too. International wires cost more and often carry an exchange rate margin on top of the stated fee.

ACH transfers between your own accounts are usually free and settle in one to three business days. Wires exist for speed and finality, so use them when the timing genuinely requires it rather than by habit.

Foreign transaction fees

Around 1% to 3% on purchases made abroad or in a foreign currency, applied by many debit and credit cards. Cards without this fee are common and free to obtain.

When a foreign terminal offers to charge you in dollars rather than local currency, decline. That conversion is done at a rate set by the terminal operator and it is worse than your card network's rate.

Fees that indicate you should move

Some charges signal a bank that treats fees as a revenue line rather than a cost recovery: paper statement fees, inactivity fees, fees to close an account, fees to speak to a teller, or fees for transactions below a monthly allowance. None of these are standard across the market.

Switching without breaking anything

Open the new account before closing the old one. Move direct deposits and recurring payments across, then leave a buffer in the old account for a full billing cycle to catch anything you forgot. Confirm the old account reaches zero and close it in writing, keeping the confirmation.

Ask about closure fees before you start. A small number of banks charge to close an account within a few months of opening it.

This article is general information about how consumer finance products work in the United States. It is not financial, tax or legal advice and is not a recommendation of any specific product or provider. Rules and pricing vary by state and by institution.