Most bank accounts cost nothing to open

Opening a basic checking or savings account at a bank or credit union is free. You do not pay a fee to create the account itself. What you might pay for instead is what happens after you open it — monthly maintenance fees, overdraft charges, or fees for using another bank's ATM.

The confusion usually comes from mixing up the opening cost with the ongoing costs. The opening part is free at nearly every mainstream bank. The monthly part is where costs vary widely, and that is where you need to look before you choose where to bank.

Key Takeaways

  • Opening a checking or savings account costs nothing at banks and credit unions, but monthly maintenance fees vary from zero to fifteen dollars or more.
  • Some banks waive their monthly fee if you keep a minimum balance, set up direct deposit, or maintain a certain number of transactions per month.
  • Overdraft fees, ATM fees, and foreign transaction fees are separate from monthly maintenance and can add up quickly if you are not careful.
  • Credit unions often have lower or no monthly fees compared to large national banks, but availability depends on whether you meet their membership requirements.
  • Reading the fee schedule before you open an account takes ten minutes and can save you hundreds of dollars a year.

Monthly maintenance fees: what they are and when you pay them

A monthly maintenance fee is a charge the bank takes from your account each month just for having the account open. This is separate from any transaction fees. Some banks charge this fee to everyone; others waive it under certain conditions.

Common monthly fees range from zero to fifteen dollars, though some premium accounts charge more. The bank deducts the fee automatically on a set day each month, usually the first or the last day. If your account balance is too low to cover the fee, you may end up overdrawn.

Many banks let you avoid the monthly fee if you meet one of these conditions: keep a minimum balance (often $500 to $1,500), set up direct deposit of your paycheck, make a certain number of debit card transactions per month, or maintain a linked savings account. Ask the bank which waiver options explore to their accounts before you open one.

Overdraft and ATM fees: the hidden costs that add up

An overdraft fee is charged when you spend more money than you have in your account. The bank covers the transaction anyway, then charges you a fee — usually $25 to $35 per overdraft. If you overdraft multiple times in one day, you may be charged multiple times.

You can usually opt out of overdraft protection, which means transactions will straightforward be declined if you do not have enough money. This prevents the fee but also means your card will not work. Some banks offer overdraft protection linked to a savings account instead, which transfers money automatically with no fee or a small fee.

ATM fees are charged when you withdraw cash from an ATM that does not belong to your bank. These fees usually range from $2 to $3 per withdrawal. If you use out-of-network ATMs frequently, these fees add up. Banks with large ATM networks or those in credit union networks (like Allpoint or MoneyPass) let you avoid this cost by using their machines.

Comparing costs across different bank types

Large national banks like Bank of America, Chase, and Wells Fargo typically charge monthly maintenance fees of $10 to $15, though they often waive them if you meet their conditions. They have extensive ATM networks, which saves you money on cash withdrawals.

Online banks like Ally, Charles Schwab, and Discover usually charge no monthly maintenance fee and no overdraft fees. They reimburse ATM fees you pay at other banks. The trade-off is that you cannot walk into a physical branch, so you handle everything by phone, app, or mail.

Credit unions often charge no monthly maintenance fee and have lower overdraft fees than banks. Many participate in shared branching networks, which means you can do basic transactions at other credit unions' branches even if yours is far away. The catch is that you must meet membership requirements — you might need to live in a certain area, work for a certain employer, or belong to a certain organization.

What to look at before you choose a bank

Before you open an account, ask the bank or credit union for their fee schedule. This is a document that lists every fee they charge. You can usually find it on their website under "Pricing" or "Fees," or you can ask a teller to print one.

Look specifically for: monthly maintenance fees and what waives them, overdraft fees and whether you can opt out, ATM fees and how many free ATMs they have near you, and any fees for closing the account early. Do not assume that a bank with a branch near you is cheaper than an online bank — the math often works the other way.

If you are new to banking or rebuilding your credit, look for banks that offer second-chance accounts. These accounts may have higher fees but are designed for people with no banking history or a negative history. Once you have established a track record, you can move to a standard account with lower fees.

How to avoid paying fees once your account is open

The easiest way to avoid monthly maintenance fees is to set up direct deposit of your paycheck. Most banks waive the fee automatically once direct deposit is active. If you do not have a regular paycheck, ask whether the bank accepts direct deposits from government benefits, pension payments, or other regular income sources.

To avoid overdraft fees, keep a small cushion in your account — even $50 — and check your balance before you spend. Many banks offer low-balance alerts via text or email, which notify you when your balance drops below a number you set. Use this feature.

To avoid ATM fees, use your bank's ATM network or an ATM network your bank participates in. If you need cash frequently and your bank has few ATMs near you, this is a reason to switch banks or choose an online bank that reimburses ATM fees.

Frequently Asked Questions

Do I have to pay anything to open an account on the same day?

No. You can open an account and start using it the same day at no cost. You may need to wait a few business days for a debit card to arrive by mail, but you can usually withdraw cash or make transfers when ready using your account number.

What if I cannot meet the minimum balance to waive the monthly fee?

Look for a bank with no monthly fee at all, or choose a waiver option that works for you — like direct deposit or a certain number of transactions per month. Online banks and credit unions are more likely to have accounts with no monthly fee regardless of balance.

Can I be charged a fee for closing an account?

Some banks charge a fee if you close an account within a certain time period, usually 90 to 180 days. This is less common than it used to be, but it is worth asking about before you open. If a bank charges a closure fee, that is a sign to look elsewhere.

Do savings accounts cost more than checking accounts?

Not usually. Savings accounts often have the same monthly maintenance fees as checking accounts, or sometimes no fee at all. The difference is in what you can do with the account — checking is for frequent spending, savings is for money you want to keep separate.

What happens if I cannot pay an overdraft fee?

The fee stays on your account as a debt to the bank. If you do not pay it, the bank may eventually close your account and report you to a banking database called ChexSystems, which makes it harder to open accounts elsewhere. If you overdraft by accident, contact the bank when ready — many will waive one fee per year if you ask.