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Three bank fees that can sneak up on you — and how to avoid them


Remember when a free checking account was easy to find?

Over the past several years, many banks have tweaked their requirements for checking and savings accounts by asking consumers to jump through certain hoops if they want to avoid paying monthly fees. That can include setting up direct deposit, using their debit cards a minimum number of times or enrolling in online banking. If you decide not to follow those rules, then you can face fees that range from $5 to $35 eachand they can quickly add up, especially on accounts that are rarely used or are being used differently.

“It’s the fees that we rarely encounter that sneak up and bite us,” says Greg McBride, chief financial analyst for

A recent report from Pew Charitable Trusts highlighted some of the ways banks large and small are making money off service charges. The good news is that many of these costs can be avoided if you take a few precautions. Here are some fees to watch for on checking and savings accounts:

Overdraft fees.

The revenue that banks collect from charging overdraft fees and other services charges has more than doubled during the past three decades, according to a report released Tuesday by the Pew Charitable Trusts. New rules put in place after the financial crisis block banks from charging overdraft fees unless consumers opt in to the service. But some people who opted in several years ago when they opened their accounts may not remember signing up, says Nick Bourke, director of consumer finance for Pew Charitable Trusts. Some people may not realize they’ve overdrawn their accounts until after they’ve been charged several times, he said, adding that many people would rather have their transactions denied than pay the fee, which is typically $35 at big banks.

People who want to avoid these fees completely should call their banks to find out if they are enrolled in overdraft programs and ask to opt out.

Monthly service charges. 

Many banks waive monthly service fees for checking accounts, which often range from $5 to $10, for customers who meet certain rules. Those requirements may include setting up a direct deposit, opening a second account or completing a certain number of transactions each month, McBride says.

Some people may start to notice the charge if they change the way they use their accounts — say by switching to a job that does not offer direct deposit, he says. Find out what the specific requirements are for you to avoid monthly service fees at your bank. Some people may want to shop around for a checking account with requirements that better match their habits.

Low balance fees.

Your savings account may have a minimum balance requirement. Falling below that threshold can lead to a recurring monthly charge of between $5 and $10. These fees can particularly add up quickly for accounts that are not used regularly since you may not notice the cost, McBride says.

Check the statements for your savings accounts periodically to scan for any unusual charges. With interest rates on savings accounts still low, those fees can quickly eat into any interest you may be earning. Consider consolidating your savings into one account to make it easier to meet any balance requirements and to keep track of the cash. Shop around with online banks, credit unions and small banks, which may offer more attractive yields than what you can get with a large institution.

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