Most checking accounts charge fees, but many banks offer accounts with no monthly fee

Whether you pay a fee depends on the bank and the account you choose. Some banks charge a monthly maintenance fee (usually $5 to $15) just for having the account open. Others charge nothing at all. The bank decides what to charge, and different accounts at the same bank can have different fees.

The key is knowing what fees exist before you open the account, because once you're in, fees can add up quickly. A $10 monthly fee costs $120 a year — money that comes straight out of your balance.

Most banks will waive (remove) their monthly fee if you meet certain conditions. The most common condition is keeping a minimum balance — usually $500 to $1,500 — in the account at all times. Other banks waive the fee if you set up direct deposit of your paycheck, or if you use their debit card a certain number of times per month.

Key Takeaways

  • Monthly maintenance fees range from $0 to $15 per month at most banks, but you can often avoid them by keeping a minimum balance or setting up direct deposit.
  • Overdraft fees (charged when you spend more than you have) are separate from monthly fees and typically cost $25 to $35 per transaction.
  • Online banks and credit unions often charge lower or no monthly fees because they have fewer physical locations to maintain.
  • The fee schedule is printed in the bank's disclosure document, which you should read before opening an account.
  • Fees can be waived retroactively if you call the bank and ask, especially if you have been a customer for a while.

Types of fees beyond the monthly charge

Monthly maintenance is just one fee. Banks charge separate fees for specific actions, and these add up faster than you might expect.

Overdraft fees are the most common. If you try to spend more money than you have in the account, the bank can charge you $25 to $35 per transaction. Some banks charge multiple overdraft fees in a single day if you make several purchases while overdrawn. This is why overdraft protection — a feature that links your checking account to a savings account or credit line — can save money: the bank pulls from the other account instead of charging a fee.

ATM fees happen when you use an ATM that doesn't belong to your bank. Your bank charges you $2 to $3, and sometimes the other bank charges you too. Using your bank's own ATMs is always free.

Wire transfer fees explore when you send money electronically to another bank. These typically cost $15 to $30 per transfer. Receiving a wire is usually free.

Returned check fees (also called NSF fees, for "non-sufficient funds") are charged if a check you write bounces because you don't have enough money. This fee is separate from the overdraft fee and can be $25 to $35 on top of the overdraft charge.

How to find accounts with no monthly fee

No-fee checking accounts exist at most banks, but you have to look for them. They're often called "basic" or "student" or "everyday" checking — the name varies. The account exists; the bank just doesn't advertise it as loudly as accounts with rewards.

Online banks almost always have no monthly fee. Banks like Ally, Charles Schwab, and Discover have checking accounts with zero monthly maintenance and often reimburse ATM fees nationwide. The tradeoff is that you can't walk into a physical branch, but for most people this doesn't matter.

Credit unions — member-owned financial institutions — typically charge lower fees than banks. If you work for a large employer, belong to a union, or live in a certain area, you may be able to join a credit union. Their checking accounts often have no monthly fee and lower overdraft fees.

If you're opening your first account, ask the bank directly: "Do you have a checking account with no monthly fee?" If they say yes, ask what you have to do to keep it free. Write down the answer so you remember.

When banks waive fees you've already paid

If you've been charged a fee and you call the bank to ask about it, they will sometimes remove it — especially overdraft fees. Banks know that customers who are charged overdraft fees are often people living paycheck to paycheck, and they have some discretion to reverse charges.

The conversation is straightforward: "I was charged an overdraft fee on [date]. Can you remove it?" Many banks will do this once or twice per year for a customer in good standing. If you're a new customer or this is your first time asking, your chances are better.

Monthly maintenance fees are harder to get reversed after the fact, but if you call and say you didn't realize the fee existed, some banks will remove one month's charge. The better approach is to switch to an account with no fee or to meet the waiver condition (like setting up direct deposit) before the next fee hits.

Reading the fee schedule before you open an account

Every bank publishes a document called a fee schedule or pricing guide. This lists every fee the bank charges. You can ask for it in person, read it from the bank's website, or ask a banker to email it to you.

The fee schedule is dense and boring, but it answers the exact question you need answered: what will this account cost me? Spend five minutes reading it. Look for the monthly maintenance fee, overdraft fee, and ATM fee. That's enough to compare two banks.

If the fee schedule doesn't clearly say how to avoid the monthly fee, ask. A banker can tell you whether you need a minimum balance, direct deposit, or something else. Get the answer in writing if possible — an email from the bank — so you have proof later if there's a disagreement.

The difference between banks, credit unions, and online banks

Traditional banks with physical branches typically charge monthly fees because they have buildings, employees, and ATM networks to maintain. Their no-fee accounts usually require a minimum balance of $500 to $1,500.

Credit unions are nonprofit organizations owned by their members. Because they don't have shareholders demanding profits, they can charge lower fees. Many credit unions have no monthly fee on checking accounts and lower overdraft fees ($15 to $25 instead of $35). The catch is that you have to be a member, which usually means working for a certain employer, belonging to a union, or living in a specific area.

Online banks have no physical locations, so their costs are lower. They almost always offer free checking with no minimum balance. The tradeoff is that you can't deposit cash in person or talk to someone face-to-face. For most people, this doesn't matter — you can deposit checks by phone camera, and customer service is available by phone or chat.

What happens if you can't avoid fees

If you're living on a tight budget, even a $10 monthly fee can hurt. If you can't keep a minimum balance and your employer doesn't offer direct deposit, you might not be able to waive the fee at a traditional bank.

In that case, an online bank or credit union is your better choice. Online banks have no minimum balance and no monthly fee. Credit unions often have the same. Both will let you build a financial history without paying for the privilege of having an account.

Some community banks and smaller regional banks also offer free checking with no strings attached. These banks are less well-known than national chains, but they exist. Ask at banks in your area, or search online for "free checking account near me."

Frequently Asked Questions

Can a bank charge me a fee without telling me first?

No. Banks must disclose all fees in writing before you open the account. You'll receive the fee schedule and a deposit agreement that lists charges. If a fee appears on your statement that wasn't in the disclosure, you can dispute it and the bank should remove it.

What's the difference between a monthly fee and an overdraft fee?

A monthly fee is charged just for having the account open, whether you use it or not. An overdraft fee is charged only when you spend more money than you have. You can have both in the same month — the monthly fee hits automatically, and overdraft fees hit only if you overspend.

If I switch banks, do I have to close my old account?

You don't have to, but most people do. Keeping an old account open costs nothing if there's no monthly fee, but it can be confusing to track multiple accounts. You can close it anytime by calling the bank or visiting a branch. Make sure you've moved all your money and updated direct deposit first.

Do savings accounts have the same fees as checking accounts?

Usually not. Savings accounts often have no monthly fee, but they limit how many times per month you can withdraw money (federal rules allow six). Checking accounts have unlimited transactions but may charge a monthly fee. Some banks bundle them together with one fee covering both.

Why do banks charge overdraft fees if I don't have money?

Banks charge overdraft fees because they're lending you money temporarily — they're covering the transaction when you don't have funds. The fee is their charge for that service. Some banks also use overdraft fees as a way to discourage overspending. You can opt out of overdraft coverage, which means transactions will be declined instead of charged a fee.