Banking has changed a lot in recent years, with fewer in-person transactions and more services conducted online or through apps. But one banking tradition remains as strong as ever---fees. A new Bankrate report says banks are charging a record amount in fees for non-customers to use their ATMs, and in fact it's the 14th consecutive year those fees have set a record high. The average out-of-network ATM fee is now just over $3, plus more than $1.50 charged by the customer's own bank. "It's gonna take a big bit, it's gonna cost you almost five bucks anytime you go outside the network," says Bankrate Chief Financial Analyst Greg McBride. "And this is five dollars needlessly spent, as ATM fees remain completely avoidable."
The de-emphasis on use of cash is a big factor in rising fees. Since fewer people are using ATMs, banks are trying to spread the costs out among a smaller group of people or simply trying to discourage people from using cash. And you can expect the trend to continue. "This is really low-hanging fruit in terms of fee income, because nobody's worried about alienating a non-customer," says McBride.
And it isn't just ATM fees going up. Overdraft fees also increased this year, and the number of fee-free checking accounts has fallen by almost half in the last decade. In terms of location, Detroit had the highest average fee, but Houston wasn't far behind. "In terms of the 25 markets we looked at in our survey, Houston unfortunately had the third highest out-of-network ATM fees, and the third highest overdraft fees," says McBride.
If you can't find an in-network ATM or aren't near one, McBride recommends just using your debit card at a store. "Getting cash back when you use your debit card is a great way to avoid ATM fees," he says. "It's like having a free withdrawal...it comes in handy."