Reducing ATM Costs column
Avoid The Squeeze From ATM Fees
from Consumer Credit Counseling Service of Greater Atlanta
It seems like only a decade ago that automatic teller machines were a novelty available at only a few banks in town. Now, they're everywhere - shopping malls, grocery stores, convenience stores, gas stations, you name it.
And naturally, as we've grown more dependent on ATMs as a society, the cost of using them has increased dramatically. What was once viewed as a convenience, has become a revenue source for financial institutions as charges and surcharges have gradually become part of the equation.
While it may seem like an inexpensive convenience to use your ATM card, if you make a lot of transactions, the fees and surcharges can add up quickly. Consider what your bank or credit union charges you to use an ATM. Most likely, it's between $1.00 and $1.50, although most banks either don't charge to use their own machines, or have only a nominal fee.
That means that, if you withdraw $20, you could pay up to 7 1/2 percent for the privilege of accessing your money. And, the latest trend in ATM charges is for the bank that owns the machine to add another surcharge of up to $2.00 to your transaction, which means your paying fees to them, in addition to the fees you're paying to your own bank. Suddenly, that $20 withdrawal costs you up to 15 percent extra, just to get your money. It's almost as bad as using a credit card.
The best way to avoid excessive ATM fees is to use them sparingly, especially when they aren't owned by your bank. People got along fine before ATMs were even invented by planning ahead for their cash needs and making a trip to the bank once a week or so.
Besides, if your bank doesn't charge transaction fees for using their machines, you can still enjoy the 24-hour access at no cost. You just have to make an occasional stop at one of their branches. If you already go to the bank once a week to deposit your paycheck, that's a good time to withdraw cash without added costs.
If your only way to get cash is through an ATM that charges extra fees, at least try to cut down on the number of transactions you make. Take out all the cash you need for the week at the same time. After all, the fees are based on the number of transactions, not the amount withdrawn. Taking out all that money at one time, though, means you have to be disciplined and not let it burn a hole in your pocket.
Another great way to save money on ATM fees is to take advantage of stores that will allow you to make debit purchases on your ATM card. Even if you have cash on hand, remember that most retailers don't charge extra for using an ATM card, and many financial institutions waive their own transaction fees as well. So why spend your cash, which costs money to gain access to, when the debit purchase is free? And by all means, if you know you'll need cash soon, and the retailer has a free "cash-back" option, take advantage of it.
Most important, only use ATMs that carry surcharges and fees when it's an emergency. Plan a stop at your bank before going to the mall. In the long run, it can save you a lot of money.