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How I Avoid ATM Fees

Posted By Jim On 12/01/2005 @ 1:28 pm In Banking | 6 Comments

A majority of my cash is spread across two bank accounts, Emigrant Direct and my company’s federal credit union, which means the number of no-fee ATMs I have access to is very low. Emigrant Direct has none (it’s entirely online) and my company’s federal credit union only has ATMs here at work yet I have never paid a single ATM fee despite the dearth of branded ATMs because I try to plan ahead – and so can you. Here are a few of the strategies I employ… and please feel free to add any that you use that I may have missed.


1. Use Credit Whenever Possible

If you use credit then you won’t need to carry a lot of cash around, plain and simple. Of course, there are times when using a credit card is simply not convenient (at a bar, where you can forget to close out a tab) but in most instances I pay with credit because 1) you get points/cashback; 2) you can conserve your actual cash; 3) you don’t have to clang stupid coins around in your pocket.

2. Keep Cash Stocked

I keep a bit of cash lying around (not on me) outside of a bank account just in case of super-short term emergency needs. Let’s say I need an emergency house repair and the repair company doesn’t accept personal checks – well, I can’t drive 20 minutes (40 mins round trip) to my credit union and get cash so I dip into my super-short term emergency fund. Another benefit is if I find myself short on cash, I can dip into the emergency stockpile and just remember to replace it later. The cost of this is like $3 (at 4% minus income tax) a year per $100 so it’s not significant. You can blow that away in one off-brand ATM transaction.

3. Get ATM-fee-less Bank Account

Bank accounts where there are no ATM fees are becoming popular where they refund you the fees charged for using an ATM, even if they were charged by another bank.

4. Get A More Ubiquitous Bank

I don’t do this but I’ve debated it in my mind. You could take the same concept of #2 but put it in a lower yield account like one with Bank of America (1%, has like a million ATMs) with more ATMs. Of course, the danger you run into is minimum balance fees and the like. It would be a travesty if you traded ATM usage fees for minimum account balance fees, which are typically larger.

5. Ask For the Fee Back

You should employ this strategy with any fee with any company, bank or otherwise. Simply ask if you can get the fee waived and give a good reason (longtime customer, ignorance, etc). This isn’t a long-term strategy though, you will only be able to use this tip a number of times before they politely refuse your request.

Here are some interesting fee statistics from the CNN/Money article [3] I was reading that sparked this post:

  • Average ATM fee rose to $2.91, all time high.
  • Americans pay est. $4.3B in withdrawal fees (Bankrate)
  • Insufficient funds fee fell to $26.90 from $27.13

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[3] CNN/Money article: http://money.cnn.com/2005/12/01/news/economy/atm/index.htm

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