Automated teller machines are convenient, but they can be costly if you are not careful. In an October 2010 survey conducted by Bankrate it was learned ATM fees have grown exponentially and consumers are paying an average of $260 a year in charges when they utilize ATMs.
According to the survey, “ATM fees leapt five percent from 2009 to a new all-time high of $2.33. Additionally, the average fee banks charge for using an out-of-network ATM increased almost seven percent to an average of $1.41.”
If you want to avoid the pitfall of having to pay ATM withdrawal fees, here are a few tips:
• Choose a bank that does not charge fees
The first thing to look for when wanting to avoid pricey ATM fees is to choose a bank that does not charge for them. Fee structures may vary from bank to bank, but many institutions will at least provide free ATM service if you withdraw money from one of its own branches. Stick with banks that at least provide free ATM service for their own customers using their banks.
• Stay in network
Banks that offer free ATM use of its own machines won’t charge you, but if you use another ATM out of your area that does not have a reciprocal agreement, this can end up costing you. Stay within your bank’s network and you can avoid having to pay the extra costs.
• Get cash back at the store
Many merchants will allow customers to retrieve extra cash when they pay for their goods. Instead of going to the ATM, next time you are shopping use your debit card and withdraw additional cash right at the register.
Mint.com recommends using the advantages offered at point-of-sale locations, “Go to a grocery store, drug store or any other retailer that would give you cash back. Buy a small snack if you don’t need to buy anything else.”
• Select a bank that reimburses ATM fees
Some Internet-based banks that do not have a brick-and-mortar location will reimburse ATM fees charged as a compensation for not owning their own ATMs. Banks such as USAA and IngDirect will reimburse up a certain amount of ATM fees. If you don’t excessively use the ATM, you’ll likely get the full amount of fees credited back to your account.
• Avoid private ATMs
ATMs owned by third parties often charge much higher fees than those ATMs associated with a bank. If you want to avoid these hefty fees, it is a good idea to avoid privately owned ATMs. Aside from the higher costs associated with withdrawing money, often it is hard to tell whether or not the ATM is a scam or fake automated teller machine.
PR Newswire reported “By exercising a little bit of caution, consumers can save themselves a lot of money and grief,” said Bankrate senior financial analyst Greg McBride, CFA. “A consumer who goes to an out-of-network ATM weekly can save $260 per year by using their bank’s ATM instead.”
That is a lot of cash, however consumers that learn the ins and outs of ATM fees and examine ways to eliminate, or at least reduce them, can put this money back in their own pockets. You don’t need to necessarily pay high fees in order to enjoy the convenience of ATM.