What Are the Two Types of Checking Account Fees That Banks Charge?

by Bonnie Conrad ; Updated July 27, 2017
Watch out for ATM fees.

Having a bank account is a virtual necessity in the modern world. Everyday activities like paying your utility bill and buying products can be very difficult without a bank account. Unfortunately, many banks have been busy raising their existing fees and implementing new fees for things that used to be free.

Monthly Maintenance Fees

Some checking and savings accounts charge a monthly fee to cover the cost of maintaining the account. These fees vary from bank to bank, so it is always a good idea to shop around for the best possible deal. Some banks will waive their monthly maintenance fee if you maintain a minimum balance or if you have your paycheck direct-deposited into the account.

Overdraft Fees

If you write a check or make a debit-card transaction that exceeds the available balance, you can face an overdraft fee from your bank. Depending on how you have your account set up, the bank will either refuse to honor the check or debit-card transaction or honor the transaction but charge you an overdraft fee.

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Look for Free Alternatives

Even though overdraft fees and monthly maintenance fees have been rising in recent years, smart consumers can still avoid them. Always look for a free checking or savings account, one with no strings attached. These accounts still do exist, even in an environment of rising rates. Banks still need to compete with one another, and offering free checking and savings accounts is one way they do that.

When you do open your free account, be sure to opt out of the overdraft protection. That means the bank will refuse to pay a check or honor a debit card transaction if there is not enough money in the account, but that can be better than running up high overdraft fees.

Controlling Costs

No matter what type of fees your current bank charges, you can control the cost of your bank account by shopping around. Many banks still offer free checking and savings accounts, and as long as you understand and follow the rules you should not be subject to any monthly maintenance or overdraft fees. You can reduce the costs associated with ATM withdrawals by using the ATM at your own bank as often as possible. If you use foreign ATMs often, you could look for a bank that reimburses you for those costs.

About the Author

Based in Pennsylvania, Bonnie Conrad has been working as a professional freelance writer since 2003. Her work can be seen on Credit Factor, Constant Content and a number of other websites. Conrad also works full-time as a computer technician and loves to write about a number of technician topics. She studied computer technology and business administration at Harrisburg Area Community College.

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