Top Ways to Reduce Those Pesky Bank Fees

Estimated read time: 4 minutes

Big banks have the notorious reputation of putting fees on their customers to the point of excess.

Many add fees for everything from not keeping enough money in your account to closing the account. Consumers who are fed up with fees they deem unfair, unnecessary, or both, have options.

While there may be some fees you can't avoid, there are ways to keep them to a minimum.

Breaking bad habits

If you can cut out making ATM withdrawals on a regular basis it can help you reduce these fees.

Consumers have become very reliant on ATMs. The machines provide a quick means to get cash, and with one being on nearly every corner, they also provide convenience.

However, the fees for this access and convenience can add up significantly. ATM fees can be $3 or even more, depending on the machine's owner. Consider this from

"…do you realize that you spend anywhere from $1.50-$3 every time you visit an ATM machine? That doesn't include your bank's fees on top of it. Altogether, you are losing about $5 per visit. So limiting your ATM visits can greatly decrease banking fees."

While the fees charged for using them may be nominal, they can quickly add up. A survey found the average ATM surcharge hit a record high for the 14th year in a row in 2018.

Part ways with brick and mortars

If you're tired of having to pay fees and your only banking need is to have a place to keep your money, you may not need an account with a traditional brick and mortar bank. That's because of the growing number of online banking options that provide basic services for free.

Outfits like Chime, Simple, Venmo, Robinhood and PayPal allow customers to conduct transactions online, and they access no fees. Customers are typically provided a debit card they can use to make purchases or pay bills to companies that accept debit cards for payments.

Deposits can be made via direct deposit or bank transfers from approved banks. These approved banks are typically the usual brick and mortar institutions. However, with most people being paid via direct deposit, this may not be a problem. What's more, many online banking outfits don't require direct deposits to meet certain minimum requirements, as do many of the traditional banks.

If you have a paper check you must deposit, some online banking outfits allow you to take a picture of the check, which they verify and then deposit into your account. This option is usually free.

Therefore, if you're tired of paying bank fees, consider opening your account with an online bank where you could rid yourself of them altogether.

If you want or need to have access to physical branches, you'll have to go with traditional banks. Seek out those that offer free checking accounts to help reduce the fees you pay.

It may be difficult to find them, however. That's because there are fewer free checking accounts available these days. A decade ago, 73% of plain vanilla checking accounts were free. That's no longer the case.

Special circumstances

There are certain situations that could help you qualify for accounts or perks that can help you reduce your bank fees.

When considering a bank, ask customer service representatives if the bank offers free or low-cost checking accounts for students or people who are older than 50. According to U.S. News and World Reports, some of these accounts may offer free checking with a lower minimum balance than what's required for their regular checking accounts.

Also, seek out banks that offer ways to earn interest on your balances. For example, savings accounts have traditionally been used to store away money and earn interest at the same time. If you keep large amounts of money in your account, it has the potential to earn you considerable sums in interest.

According to, there are some banks that also pay interest to those who have direct deposit into their account.

Richard Barrington, a senior financial editor for, told U.S. News the following:

"While conventional wisdom says you should keep the bulk of your excess funds in a savings account, it might be more economical to keep additional money in checking to avoid a monthly fee. Interest rates are so low right now that if you do the math … you're probably better off taking some money out of savings."

To protect or not protect

When it comes to overdraft protection, observers seem split over whether or not you should sign up for it.

Given the protection can help reduce overall fees that come with bouncing a check, some see it as a good thing.

DebtSteps says:

It has happened to the best of us. When you get one of those hefty draft fees ($20-35 per draft), it causes a ripple effect. Ultimately, your account is in turmoil. Many banks offer overdraft protection so that if this were to happen, you won't be paying triple to even your balance back out.

However, others disagree about the necessity of the protection. U.S. News reported people should opt out of overdraft protection. It found that if you don't have the money in your account, your transaction will be declined, so you won't incur an overdraft fee.

In 2010, the law changed to make opting out the default, but banks will push you to opt-in by framing overdraft protection as a consumer service, according to U.S. News.

Barrington told the news outlet:

"It's just too expensive. It's protection in the same way some underworld enforcer will offer you protection."

Other fees that can be reduced

Check printing: Don't go through your bank. Instead, go with a third party that will print checks for a fraction of what banks charge.

Negotiate: Some bank branch managers have the authority to waive fees, especially if you don't have a bad track with them.

Be vigilant: Stay abreast of your bank balances to avoid spending money you don't have, which could lead to those overdraft fees. Sign up for bank alerts that show balances and transactions.