This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Rising ATM Fees -- And How To Beat Them

Following MoneyRates.com research that has documented the rise of ATM fees, a new government report confirms that bank customers are paying more to access their funds at these machines.

According to a U.S. Government Accountability Office report released this month, some customers are paying ATM fees as high as $5 per transaction. But banks may be inclined to argue that these fees aren't out of line, as the GAO report also indicates financial institutions are paying more to maintain ATMs and the revenue from these machines is declining.

More ATM fee increases may be coming

When adjusted for inflation, the average ATM fee in 2007 was $1.75. That amount has risen over the last five years to reach $2.10 in 2012. Overall, ATM fees at machines surveyed by GAO ranged from 45 cents to $5.

Those numbers were for ATMs operated by financial institutions. Independent ATMs had slightly higher fees, with an average of $2.24 in 2012. Fees at these machines ranged from $1.50 to $3.00.

While conventional wisdom may indicate ATMs help banks save money by reducing their need for branch staffing, the financial institutions surveyed by the GAO say the cost of maintaining their automatic tellers is rising. Some of the reported costs associated with operating ATMs included hardware and software investments , rent , infrastructure and transaction processing.

ATM operators told the GAO their costs have increased during the past five years while their revenues have declined. Many operators told the government office that in the near future they expect their costs to continue to rise while revenues remain flat or decline further, suggesting that consumers may see more fee increases in the future.

How to avoid ATM fees

At up to $5 a pop, ATM fees can quickly become a serious drain on your wallet. Fortunately, there are ways to avoid paying them.

  • Use in-network ATMs. Banks and credit unions typically do not require their own customers to pay fees when using the institution's ATMs. In addition, the GAO notes many banks and credit unions belong to larger networks that offer additional locations where customers can access their accounts fee-free.
  • Swipe your debit card as a credit card. Even financial institutions that offer free ATM transactions may put a limit on how many free PIN-based transactions you get each month. If you always enter your PIN when making purchases with your debit card, you could quickly exhaust your free transactions and start racking up fees. Instead, ask the clerk to run your card as credit when possible.
  • Switch banks. Finally, you may want to re-evaluate your choice of banks if you find yourself regularly paying ATM fees. Other banks may have a more extensive network of ATMs closer to your home or workplace. Another option may be online banks, some of which, such as Ally Bank, currently refund ATM fees charged by operators outside their network. As a bonus, the best interest rates on savings accounts can often be found at online banks.

ATM fees may be on the rise, but with a little planning and some comparison shopping, savvy consumers should be able to minimize the fees they pay when accessing their accounts.

null

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,265.99 +109.14 0.64%
S&P 500 2,011.36 +9.79 0.49%
NASDAQ 4,593.4250 +31.2360 0.68%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs