How to save money at the ATM

Pull a fast $40 out of a non-network ATM, and you may be dinged for five in fees — $2.50 to Bank of America, for example, and then three dollars to the owner of the ATM? It’s one of those scenarios we all hate. Ross Kenneth Urken, personal finance editor at TheStreet, has a few ways for us avoid those fees.

It’s one of those annoying instances. It’s not breaking the bank, but in aggregate those fees add up. Your approach to anything, should be your approach to everything. Be savvy, money conscious and those habit will inform the rest of your financial life. Plus it is big money; last year, the three big banks earned almost 1 billion in ATM fees.

What can we do to avoid these pesky fees? One easy solution is to open a High Yield Investor Checking Account with Charles Schwab. This gives you Unlimited ATM fee refunds on any ATM worldwide. There are no minimum balances and no monthly fees. Banks are getting competitive with each other and looking for ways to distinguish themselves and earn your business.

But thinking outside the bank box can help, too, right. Ding, ding, ding. Of course, the big banks, Bank of America, JPMorgan Chase, Wells Fargo, Citibank are charging you $2.50. For consumers looking to avoid ATM fees, join a credit union that belongs to the nearly 30,000 ATM network operated by credit union service organization CO-OP. Transactions are surcharge free. To put the 30,000 number in perspective, Bank of America, which operates one of the largest — possibly the largest — bank-owned ATM network, has a tick over 16,000 ATMs. The CO-OP network is huge and it came about because tiny credit unions (which often own just a few ATMs themselves) realized long ago that to compete against the big banks they had to band together and their ATM network is how.

Some options won’t provide entirely fee-free ATM use but will cover you more often than not. That’s absolutely right. Ally Bank, for example, will refund $10 a month in ATM fees. That’s going to cover you more often than not. USAA refunds $15 a month.

Discover Cashback Checking, from the company with the same name credit card, is fee-free, no minimum balance and it boasts an ATM network of 60,000, via networks provided by AllPoint and Moneypass.

If you really need cash, use a debit card to buy groceries at a local pharmacy or supermarket, and then get free cash back. Usually you can get up to $40 or so per visit. Use a credit card as much as possible for ‘walking around’ expenditures. Not only will you have better protections against potential fraud and other coverage, but you will earn miles, cash back, or other loyalty currency.