Are Your ATM Fees Adding Up?

by Emily on October 7, 2011

ATMs are a convenience; they are practically on every block in major cities as well as restaurants and grocery stores. When you’re on the go and you need cash, you just go to a machine and within seconds you have money from your account without actually having to set foot in the bank. We all use ATMs but sometimes we just go to the nearest one, even if it is not our bank. Each time you withdraw cash from a foreign bank, you incur an ATM fee. So in the end, grabbing $20.00 quickly can cost you up to $26.00 with fees. Both the bank and the ATM machine owner can charge fees to non account holders, so these fees can add up pretty quickly if you are not careful.

By law, ATMs are required to tell the user how much the fee non account holders will be charged. You will typically also be charged a fee by the bank in which you have an account, when you use a foreign ATM. If you are traveling outside of the United States and use an ATM, you will be charged an additional fee.

If you use ATMs twice a month that are foreign ATMs not operated by your bank, you could be charged $3.00 from the foreign ATM and $2.00 by your own bank per transaction. That’s a total of $5.00 per transaction, or $10.00 per month, which leads to spending $120.00 per year on ATM fees. This is a low estimate of how much ATMs fees can actually cost you. If you use ATMs at bars, sports complexes, casinos or theme parks, the fees are much higher. Another hidden ATM cost that you may know about is the denial fee. If you try to withdraw money from your account, but your balance is too low to do so, some ATMs will charge you a denial fee for trying to take out more money than you have in your account. Also, even if your account balance is low, some ATMs will give you the cash amount requested and then you wind up with hefty overdraft charges which can run anywhere from $25.00 to $45.00 per transaction.

Like most people, I hate to give my money away. If I wanted to give away my money, I would choose a charity and not a bank. So here are some tips you can follow in order to avoid having to pay ATM fees you should:

  • Write checks instead of using cash
  • Carry sufficient amounts of cash when traveling
  • Keep an emergency $20.00 hidden in a part of your wallet or purse
  • Use travelers checks when traveling abroad
  • Try to only use ATMs offered by your bank
  • When using your debit card for purchases select cash back at the register
  • Shop around for banks and find one that does not charge fees for foreign ATMs
  • Choose a bank that offers reimbursement for ATM fees charged by other banks
  • Schedule your time, and budget so you are not forced to go to another banks ATM, and you can utilize your own banks ATM
  • Withdraw larger amounts of cash so that the fee will be a smaller percentage of your cash withdrawal.

By avoiding ATM fees you will be able to spend more money on the things you want and giving away less to large financial institutions.

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