Checking Account Fees Hit New Highs

Almost all costs and fees are up at the brick and mortar banks included in Bankrate’s 2007 Checking Account Pricing Study. Average fees reached new peaks across the board.

  • Bounced check: $28.23 (+3%)
  • ATM surcharge:$1.78 (+$.14)
  • Monthly checking service: $11.72 (+$.98)
  • Min required to avoid fees: $3,316.60 (+ 25%)

More than ever, high-yield online savings accounts like HSBC Direct, and ING Direct are the place to park your dough.

Fall 2007 Bankrate.com Checking Account Pricing Study

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  1. kc2idf says:

    Just taking a quick look at the bar graph, it looks to me as though the fees are pretty close to (but slightly behind) the inflation rate. Sure, it would be nice if it remained static, but it looks like it hasn’t really gotten any more exhorbitant.

  2. jblake1 says:

    Here is the problem as I see it as a consumer. Banks continue to market accounts as being FREE. They obviously are far from free. Marketing something as FREE when it ends up not being makes the consumer feel ripped off when they end up adding up the charges. Yes we all know banking services are not FREE but psychologically the word FREE dupes most consumers into decisions without being fully informed.

    Banks should market honestly and maybe figure out a way to market based on margin. For example: 10% Bank Margin Checking, or Totally FREE Except for the FEEs Checking.

  3. Myron says:

    The graph suggests the cost is gradually going up over time. This is not remarkable.

    What is remarkable is how the linked article is split over seven pages. I won’t bother with it and I’m surprised anyone else would.

  4. mac-phisto says:

    @jblake1: banks are actually required to disclose all this stuff in their truth in savings disclosure, account agreement & eft (electronic funds transfer) disclosure & fee schedule. most people just don’t take the time to read or at least ask questions to avoid fees though.

    there are actually FREE accounts out there that have no minimum balance requirements & no maintenance fees. if you go looking, here’s some good questions to ask when shopping for a new account:

    -is there a minimum balance requirement & what is it or do is there a balance requirement in an “attached” account?
    -are there other stipulations to keep the account free (direct deposit, minimum/maximum usage limits, etc.)?
    -is it free for the life of the account, or is this a promotion that expires over time?
    -are there “teller fees”, “branch fees” or anything similar that charges for face-to-face transactions?
    -what fees are associated with the account & how are they incurred (o/d fees, atm fees, transfer fees, etc.)?

    every account has fees. the question is whether they can be avoided through average usage. the key is knowing what fees exist so you can navigate around them. i’ve had bank accounts for over 15 years & i’ve never once paid a bank fee (aside from atm fees), so it can be done.

  5. bohemian says:

    What is more of an issue is how they implement their fees. More banks are coming up with creative ways to deal with accounts in order to create more fee situations. Things such as paying the largest check in order to bounce a bunch of smaller ones has been cited before. Some banks are now treating EFTs as written checks, paying them and charging you an NSF instead of rejecting the EFT. Some are allowing POS charges when the account does not have sufficient funds or has a check in process.

    Even for honest people who try to keep their accounts managed, this creates more work babysitting their accounts. I think the real goal with all of this is to force people to keep a significant sum in their checking that they can use as capital or make people pay through the nose as the other option.

  6. Fuck Lion says:

    @jblake1: My checking account is free. I keep enough money in there that I don’t get overdraft fees.

  7. SkyeBlue says:

    Checking accounts and ATM cards are such an expensive “convenience”. I haven’t had either in 11 years and I don’t miss having those at all. People seem to think they are a a “necessity” but as as an example I pay my bills in cash mostly, in person or at a place that sends the payment electronically for me, which saves me having to buy a money order or stamps and I don’t have to worry about the payment being “lost in the mail”.

    If I have to send a payment in, say for a credit card payment, I do it by money order. I spend less than $4.00 a month on money orders to pay my bils with.

    A small expense, but one I do not have to pay to the bank for the privilege of using my own money!

  8. NoWin says:

    @jblake1: Banks continue to market accounts as being FREE. They obviously are far from free.

    Well, maybe not completely accurate. Customer “oops” are also free: one is free to bounce a check, OD your account, not keep your debit card safe, etc…

    Do NOT do any of the above, and your checking account is free of charges, except maybe new check orders (your bank/cu may vary) or special services.

    You get a copy of your disclosure, and current schedule of fees when you open an account, and a new copy when fees are changed. Nothing is hidden from the consumer.

    One pays for ones own indiscretions.

  9. @jblake1: How about Free Maintenance Checking meaning there is no maintenance fee?

    It would have been interesting to see this graph for specific banks. Which individual banks would show increases much larger than the average?

  10. Buran says:

    @mac-phisto: Exactly. I pay no fees on the accounts I have because I picked an account that met my exact usage patterns (no fee if you have direct deposit, for example). bingo.

  11. enm4r says:

    @NoWin: Agreed. Everything is black and white. It isn’t hard to request fee schedule from your bank. There are choices that include truely free accounts for those who spend minimal time looking. What do you know, I’m blaming the victims…

  12. Buran says:

    @SkyeBlue: You’re probably still being stiffed with fees for the “convenience” of paying in person.

  13. Buran says:

    @Myron: For some reason, web designers these days think it’s ridiculous for us to have to scroll too much and think that waiting for 7 pages to load is better than waiting for 1 and just designing the site to expand gracefully vertically.

    Ridiculous. I won’t do that on sites I make.

  14. Riss says:

    I admit I made a mistake and used money from the wrong account to pay for groceries. But the result was almost $400 worth of insufficient funds fees (for the purchases I made in the same day at other stores) in a 5-day period. They should have just declined the card. $400 is a little over the top, even for Chase Manhattan but they didn’t budge.

  15. teh says:

    AHH! It’s insufficient!

  16. SadSam says:

    To be free or to not be free, that is the question. I have multiple accounts with Wachovia (including a big fat mortgage for which Wachovia collects more than $10,000 in interest per year) and I am a long term customer.

    I noticed that many more random fees were popping up in my primary checking account (not fees for overdrafts or my screw ups but random fees). When I called to find out what the problem was I learned that my account is so old that they no longer offer it anymore and were phasing it out (they claim I was informed via an insert in one of my statements). Fine, I told the rep., I want an account that is free and fee free and they refunded the random fees and told me they put me in an account that would match my wants and needs. Of course, the next month I had different random fees (this time for my monthly Quicken download) when I called back I was told that my new account had fees for x, y, z, etc. Ugh! And told that the account I wanted didn’t exist (I wanted the bank to give me a free and fee free account with full services because of the large amount of money I pay in interest on my mortgage to the bank and the many other accounts I hold with the bank). When I spoke with a supervisor I was able to get the correct type of account “crown” that factors in the mortgage and other accounts with the bank. This month I had more fees on my account that I need to call about, most likely due to the time period in which I was in the ‘free’ account.

    Bottom line, I have a long term relationship with this bank, more than 10 years, I have multiple accounts with them, and I pay them good money each month on the mortgage (held by the bank, never sold to another company) and I still get the shaft. I’m very close to changing banks but don’t really want to hassel with refinancing the mortgage so I’m waiting to see if the ‘crown’ account fixes the problem.

  17. @Buran: It’s not the web designer making the decision, it’s the client. Lots of people believe that Internet users won’t scroll to see an entire page. Sometimes it’s that the client insists on the content printing out on only one page.

    Where it gets hairy is when they ask for this AND want a lot of content on the page. Arg!

  18. FLConsumer says:

    @SkyeBlue: “free” depends on how much time you have and how much your time is worth. MY time is worth more than having to deal with the hassle of trying to get money orders, driving to various sites to pay bills, not to mention the gasoline that’d waste. I let Wachovia deal with all of that and let them send the payments. No worries about it getting “lost in the mail” either. If something happens and the vendor doesn’t receive prompt payment, it’s Wachovia’s problem and they’ll deal with it, not me.

    If you’re paying ~$4/mo for money orders (and let’s assume $0.50 for postage + envelope), $4.50 * 12 = $54 a year you’re paying.

    How much have I paid in Wachovia fees over the past 10 years? $0.00. Actually, Wachovia’s PAID ME a little over $2,000 in that time.

    You tell me, which is cheaper?

  19. olegna says:

    Once again, the argument appears that bank’s can nickle and dime you because, shame on you, you shouldn’t be overdrafting anyway.

    I don’t overdraft. Recently a $2.50 “protection” monthly fee began appearing on my account. (Still haven’t called about it, because I am a net saver and since $2.50 a month is nothing I am irresponsibly allowing my bank to sneak in a monthly charge because it’s not that much and they’ll probably refuse to remove this charge anyway.)

    The point isn’t “you should be more responsible”. The point is when you sign up for an account the fine print basically says “all terms of this contract between you and the bank can be revoked or altered at any time and at the bank’s discretion.”

    That’s the problem.

    I’m tired of this holier-than-thou crap about “well, if you were more responsible this policy wouldn’t affect you.”

    It’s like saying “if you aren’t a terrorist you should have no reason to oppose warrant-less phone taps.”

    What? Only “responsible bank account holders” are allowed to have a strong opinion on this gradual increase in bank’s OD charges?

    Actually, as I pointed out before: the same gradual increase in ALL fees can affect even account holders who are “better” human beings that don’t deserve bank fees because they’re so amazingly responsible with their finances. I have $10K in my savings account and suddenly am now paying $30 a year more tan last year for god knows what.