Why pay a fee to take your own money out of your
checking account? Many people do just that because they use ATMs
that don't belong to the bank where they have an account. In fact,
banks rake in more than $2 billion every year in ATM charges.
If you use a so-called "foreign" ATM, you
can expect to pay two fees. Your bank will charge a fee because
it has to process a transaction from some other bank's ATM, and
the bank that owned the ATM will charge a fee -- called a surcharge
-- because it has to process a transaction from someone who's not
a customer. It's a double whammy, and it's very costly.
High fees for convenience
It's common for each bank to charge $1.50, $2 or even more in major
metropolitan areas, airports, hotels, sports venues and other places
where they know you're hard-pressed to find an ATM owned by your
bank. Imagine withdrawing $40 and paying $4 in fees, a 10-percent
charge for accessing your own money.
Consumer groups contend that processing ATM transactions
costs banks very little and that these fees are just an opportunity
for institutions to make money. Banks counter that surcharges provide
them with more revenue to install automated teller machines at sites
that wouldn't ordinarily have them. The end result, they claim,
is greater customer convenience.
Plan ahead to avoid fees
You'll always know if you're going to be surcharged because a statement
is displayed on the ATM screen before you press the key to get cash.
You're given the option of continuing with the transaction or canceling
it. In reality, probably very few people decline the transaction
at that point. That's why it's so important to be certain you have
cash on hand for planned and unplanned minor expenses.
If your bank or credit union doesn't have ATMs it
will likely have an agreement with an ATM network that either allows
you to access certain machines for free or you'll be reimbursed
by your institution for surcharges. Usually there's a limit of four
to six fees that will be reimbursed. Know your bank's policy.
Bankrate.com routinely surveys hundreds of checking
accounts for the best checking and ATM rates, meaning accounts with
the lowest fees. Check our database
for the account that's right for you.
Have you ever made a deposit at an ATM? Be aware that
under some circumstances you may have to wait longer to access your
deposits -- more on that in the next section.