After years of free checking account deals, fees have returned to your bank account.
The "free" in free checking is going away to make up for diminishing overdraft revenue. (Law now requires that customers opt-in to costly overdraft protection. It used to be a default.) Meanwhile ATM fees continue to climb if you dare use an out-of-network machine.
Even if you ask for a list of fees, most banks won't hand it over easily, according to a 2011 report from the U.S. Public Interest Research Group. But all is not lost: there are still banks and tools out there that can help you avoid the fee-machine. You just need to know where to look.
Shop around. Don't just look at the big name banks and financial firms.
- Go small. In many cases, fees and minimum balances required to avoid fees are lower at credit unions or local and regional banks. But you may sacrifice conveniences like ATM availability and range of services. (Most credit unions don't offer advisory, wealth management or treasury services.)
- Go online. Carefully consider forgoing bricks and mortar banks altogether and bank online. Many Internet banks still off free accounts or will charge less if you elect to have statements sent to you electronically.
- Scan the web. Check out Bankrate for a tool that lets you search for online and physical locations in your area. Other sites with similar tools include MyBankTracker, Find A Better Bank, and Money Rates.
Stay alert. A little extra planning can help keep more money in your wallet.
- Sign up. Email and text message alerts from your bank can help you monitor your balances and spending activity, but only if you actually sign up for them. Keeping those account balances well above the minimum will help you sidestep overdraft or minimum account balance fees.
- Watch the ATM. As banks test out higher ATM withdrawal fees, it pays to use an ATM in your bank's network. Use bank websites and mobile apps to track down your banks' ATMs to avoid getting hit with additional charges to withdraw money. Some of the larger banks, like Bank of America, have ATM locations within their mobile app.
Speak Up. It can pay to just ask for a better deal.
- Just ask. Don't like a fee? Experts say to ask your bank about removing it or for ways that you can avoid it, like opting for direct deposit or paperless statements. Avoid the lines at the bank or online by using online chats. Many of the larger banks, including Bank of America, Chase and Wells Fargo have these features on their websites.
- Get it together. Consolidating multiple accounts at one bank can give you a bigger voice, since banks are more likely to listen to someone that does a lot of business. Run the numbers and see if it makes sense to do all of your checking, saving, investing and borrowing in one place.
What not to do to avoid bank fees.
- Don't blindly opt in to overdraft protection. According to a study by the FDIC, nearly 75 percent of bank account holders didn't overdraft in rolling 12-month periods starting in 2006-2007Banks continue to push this option, which, for a fee, allows a payment to go through, even if there's not enough money in the account to cover the transaction. And no wonder, banks collect about $30 or so for any transaction over their account limit. Experts recommend forgoing the protection and using an alternative form of payment (cash or credit card) if your debit card is declined.
- Don't take the deal. Promotions that promise $50 or $100 if you open a new checking account may actually be too good to be true. There are almost always strings attached in the form of accounts with high fees or other requirements.
- Don't only use interest checking accounts. Interest checking is appealing -- who wants cash just sitting there? But these accounts often have higher minimum balance requirements than no-interest accounts, and steeper fees and penalties.