|
Banking fees, balance requirements for
checking accounts and ATM costs continue
to rise while interest earnings on
checking accounts do not, according to a
Bankrate.com survey.
Bankrate.com's semiannual checking
survey looks at the checking accounts
and corresponding ATM fees by the
largest banks and thrifts in each of the
25 largest markets nationally.
Bankrate.com surveyed 248 banks offering
checking accounts, looking at 462
accounts -- 247 interest and 215
noninterest. Bankrate.com then compared
them to a sampling of checking accounts
available at Internet banks.
The key findings of the study are:
Getting whacked with bounced-check fees
can leave quite a welt on your wallet.
The average bounced-check fee is $27.04,
and with more banks using a tiered
structure, the cost can quickly
escalate.
ATM surcharges hit a new high and are
more prevalent than ever. The fee that
banks charge to nonaccount holders now
averages $1.60, with 98 percent of banks
owning ATMs charging a fee.
The average balance requirement on
interest-checking accounts hit a new
high of $2,465. And you're not getting
much in return, as interest-checking
yields remain in the cellar.
Here is what Bankrate.com found in its
latest survey, what it means to you and
some solutions to save you dough.
Bounced-check fees
Bouncing a check results in a punitive
fee from your bank, and the punishment
is growing increasingly harsh. The
average bounced-check fee increased from
$26.90 to $27.04 since the fall survey,
the second-highest ever recorded
following the $27.13 average of one year
ago.
The average bounced-check fee has
increased with remarkable consistency
since the twice-annual survey commenced
in 1998. The first survey, in fall 1998,
carried an average bounced-check fee of
$21.57 and has increased about 25
percent since. Only twice in that time
has the average fee failed to increase
from one study to the next. Even Tiger
Woods isn't that consistent.
The increase in the average fee this
time around is no fluke. The number of
banks increasing bounced-check fees
outnumbered those cutting fees almost
2-to-1. There were 39 increases but just
19 decreases.
But as Paul Harvey would say, "And now,
the rest of the story." The cost of
bounced checks doesn't stop after the
first occurrence. In fact, it gets
worse. Why? Increasingly, banks are
employing a tiered fee structure for
bounced checks. Under the tiered
structure, the cost of bouncing a check
can increase as additional checks fail
to clear.
For example, since the last study,
Wachovia Bank has introduced a tiered
fee structure for bounced checks. The
first check will cost $25, with the fee
increasing to $30 each for the second,
third and fourth checks, and anything
beyond that is $35 each. Furthermore,
Wachovia's policy is typical of some
other large banks, such as Bank of
America and U.S. Bank, in that, when
charging the fees, it counts all the
occurrences during the past 12 months.
So while the cost of one bounced check
at Wachovia decreased to $25 from the
previous survey, the cost of bouncing
more than one check or repeatedly
overdrawing the account during a
12-month period is now higher. The
account holder that rarely bounces
checks may catch a break under the
tiered structure, while more routine
slip-ups come at a higher price.
So, how best to protect yourself from
the ever-escalating cost of bounced
checks? The first line of defense is to
sign up for overdraft protection,
preferably by linking a savings account
to your checking account. Also, be
particularly diligent about recording
all of your transactions, especially if
you favor the use of a debit card or
have regular monthly payments
automatically withdrawn from your
account.
 |
|