How You Can Avoid Rising ATM Fees

Banks are charging higher ATM fees, but here are some ways to skirt around them.

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Person withdrawing cash
Getty ImagesThree of the nations largest banks have hiked their out-of-network ATM fees by 50 cents in the past six months.
By Simon Zhen

Rising ATM fees are making it more expensive for consumers who regularly use an out-of-network ATM to withdraw cash. The trend may be the push that some consumers need to find a better checking account or bank.

In the past six months, three of the nation's largest banks -- Bank of America (BAC), Citibank (C) and SunTrust Bank (STI) -- have each hiked their out-of-network ATM fee from $2 to $2.50. At the top 10 U.S. banks, the average out-of-network ATM fee is $2.45, up from $2.25 in November. Then, don't forget that ATM operator also has the right to slap on a surcharge, usually around $3 to $5.

If ATM fees are becoming a costly expense for you, here are some ways to avoid them:

Find your bank's ATMs on your smartphone. The biggest reason we resort to using an out-of-network ATM is because ATM machines from our banks are nowhere to be found when we're in a rush. In many cases, your bank's ATM could just be around the corner, but you're in a hurry, so you don't care to check. Instead, you're willing to get hit with the ATM cash withdrawal fee, plus any ATM surcharge.

However, with easy access to the Internet through smartphones, it would be wise to search for nearby ATMs. Many mobile banking applications feature a locator tool that will help you find an ATM based on your GPS location.

Remember to use affiliated ATM networks. There are financial institutions -- usually community banks and credit unions -- that partner with other financial companies to expand ATM availability without imposing surcharges. For instance, some smaller banks and online banks work with the Allpoint or STAR ATM networks to provide more surcharge-free access to ATMs. Some credit unions also partner with the CO-OP ATM network, which doesn't impose surcharges for members of partnered credit unions.

Additionally, financial institutions may work with retailers to place branded ATMs within their stores. For instance, Chase (JPM) has ATMs in Duane Reade and CVS/pharmacy (CVS) stores, while Citibank has ATMs in 7-Eleven convenience stores.

Get debit card cash back. When swiped at certain types of retailers, usually grocery stores, gas stations and convenience stores, your debit card can be used to get cash from a store clerk when you make a purchase.

For example, you can buy a candy bar for $1 and ask for $20 in cash back. The cashier will charge $21 to your debit card and will give you $20 in cash plus your purchase. There is no fee to use this cash back option. (Keep in mind the store may restrict how much cash back you can pull out, and you are subject to your card's daily debit card purchase limits.)

In the end, this method is likely to cost less than paying an out-of-network ATM fee.

Find a no-ATM-fee checking account. One big move to minimize out-of-network ATM fees may be to look for a new checking account that doesn't charge any ATM fees. Most brick-and-mortar banks are unable to waive ATM fees because the fees go toward the operational costs of their ATM networks.

No-ATM-fee checking accounts are more common at online banks and brokerages. Ally Bank and Schwab Bank, for example, have free checking accounts that offer unlimited ATM fee reimbursements.

If you are thinking about opening a new checking account, remember that you don't necessarily have to ditch your old one. Since there is no monthly fee, you can just designate your no-ATM-fee checking account for out-of-network ATM cash withdrawals.

Switch to a better big bank. When you notice you're paying too much in out-of-network ATM fees, it may not be because you are using a big bank that charges such fees. It may be because you aren't using the right big bank with the most convenient ATM network located near you.

Switching from one big bank to another big bank with more accessible ATMs could help mitigate hefty ATM fees.

Be sure to take notice of bank branches and ATMs near places you visit frequently such as your workplace, grocery stores and restaurants.


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alirae78

Right off the bat the author suggests using that "smart" phone that so many people live their lives through to lead their nose to an ATM. So how much is the monthly fee for that phone? I use a credit union and have a phone that does all I need it to do-call and text, at $30 a month.

May 06 2014 at 10:51 AM Report abuse rate up rate down Reply
sunraedreams

Join a Credit Union!

May 05 2014 at 11:44 PM Report abuse rate up rate down Reply
gdtenpin

The best way to avoid ALL of those fees charged by the banks? Pull your money out and join a credit union. No ATM fees and you can use an ATM at any credit union for no charge.

May 05 2014 at 9:07 PM Report abuse +2 rate up rate down Reply
terwalk2

thats it. bleed us americans dry,so non-americans can put more bucks in thier pockets. they call mexicans and other foreighners minority, listen up folks, we the americans are minority now.

May 05 2014 at 4:17 PM Report abuse +1 rate up rate down Reply
1 reply to terwalk2's comment
jelun

You sound like an idiot, but, you probably already know that.

May 05 2014 at 6:29 PM Report abuse -3 rate up rate down Reply
larrysrugs

veterans.... get a USAA checking account...free and they reimburse up to $15 a month in ATM fees.... check it out...

May 05 2014 at 4:07 PM Report abuse +2 rate up rate down Reply
2 replies to larrysrugs's comment
sunraedreams

Not sure if it's still going on but Navy Federal Credit Union was giving $50 for each refered new member and giving the new member the $50 to open the new account! Awesome deal!

May 05 2014 at 11:46 PM Report abuse rate up rate down Reply
alirae78

Yep, I've been a customer for 16 years now. USAA also offers MANY services besides just banking.

May 06 2014 at 10:45 AM Report abuse rate up rate down Reply
tsc1956

The banks do what they want wonder where the fees go to lets see 20mil for the CEOs who knows at least when you give money to a drunk you know where its going. ATM fees are the banks way of saying we work really hard at using your money so we need to charge you. Not only does the bank you use to take your money and charge you so does the bank that you bank at charge you for using the other bank also they charge you a fee for pumping at gas station as well. This is the real crime sydicate better off dealing with a bookie least you know what happens if you dont pay its simple interest.

May 05 2014 at 3:49 PM Report abuse +2 rate up rate down Reply
Paul Kostiuk

This is very, very ,simple!!!!!!!!!!!! you just don't use the ATM!!!!!!!!!!!!!!!!!!!!!

May 05 2014 at 3:19 PM Report abuse +1 rate up rate down Reply
1 reply to Paul Kostiuk's comment
David S.

Really, Paul? What do you do when you need cash......

May 05 2014 at 3:44 PM Report abuse rate up rate down Reply
Ramvir Thakur

ramvir hello nepali rup

May 05 2014 at 3:16 PM Report abuse rate up rate down Reply
lakearcher

I once divided one Walmart purchase into five at the check-out. The cashier gave me $100.00 per purchase: $500.00. Any one purchase at Walmart is up to $100.00 cash back. The USPS gives up to $50.00 cash back. Buy a one cent stamp - get cash back. I have direct deposit and have not been inside my bank (or any bank) since the Fall of 2006.

May 05 2014 at 2:40 PM Report abuse rate up rate down Reply
2 replies to lakearcher's comment
setec5354

Sure there were no handling fee for cashing at other institution???????????

May 05 2014 at 4:29 PM Report abuse rate up rate down Reply
alirae78

I can't imagine intentionally going through a Walmart check-out five times to complete one purchase.

May 06 2014 at 10:55 AM Report abuse rate up rate down Reply
California Granny

Who needs them machines. I surely don't. Have never used and never will. Why pay good money for MY money.

May 05 2014 at 2:34 PM Report abuse +1 rate up rate down Reply