How to Avoid ATM Double Whammy

When you are out and need cash quickly, ATMs can be convenient, but their fees are not.

You’ve probably experienced double whammy before when you had to stop and get cash from the closest ATM that wasn’t in your bank’s network, only to find out that you will get charged a fee in order to withdraw your money along with another fee from your bank or credit union simply for using an out-of-network ATM.

Having to pay money to receive your own money is a tactic that banks have been using for quite some time now.

How did it all Begin?

The nation’s first ATMs were installed in the late 1960s to help offer customers a convenient way to retrieve their money outside of their bank’s regular hours. By the 1980s, most ATMs became ‘shared’ or used by customers of more than one particular bank. This is how ATM networks began to surface.

In 1996, banks started charging customers a ‘foreign fee’ for using ATMs that were out of network. By 1998, the double whammy began when banks started charging a surcharge fee to non-customers who used their machines.

When ATM fees were first established, the law required a sticker on all machines that acted as a disclosure to notify customers that they may be charged a fee to withdraw their money. In 2013, Congress amended the law so consumers would no longer see those types of stickers on ATM machines and instead, they will be notified about the amount of the charge during the transaction process on the machine’s screen thanks to the Consumer Financial Protection Bureau.

CNN Money reports that ATM fees have increased by at least 20% from an average of $1.75 per transaction in 2007, to $2.10 in 2012 according to a study conducted by the U.S. Government Accountability office.

As you can imagine, customers were and are not happy about having to pay twice to use certain ATMs. Luckily, there are quite a few things you can do to avoid getting charged unnecessary fees for withdrawing your money.

Only Use ATMs in Your Network

Being more mindful of which ATMs you use and making sure they are in your network is a simple way to avoid fees and save money. It may not be the most convenient method at first to pick and choose an ATM when you need money However, if your bank has a mobile app, it should be able to help you locate all of their ATMs.

The mobile app will be handy when you are on the go an in search of in-network ATMs that are nearby.

Opt to Receive Cash Back

Most retailers offer a cash back option at the register when you check out. There may be a limit to how much money you can get back like $100 or so, but if you just need a little money like $20 or $40, this is a great way to withdraw your cash without paying a fee.

You can get cash back when you’re making larger purchases like for groceries or you can just purchase something small that you need at the time in order to utilize this option.

Change Your Bank

If you don’t want to go through the effort of having to dodge ATM fees left and right whenever you need money and your bank is closed, you can always switch to a better bank that will give you more options. Online banks partner with thousands of ATMs throughout the country to eliminate fees for customers.

Ally Bank account customers can use any ATM nationwide without having to pay a fee and if other banks do charge a fee, Ally will refund the account.

Capital One 360 is another online bank that offers more than 38,000 different ATMs across the country to use fee-free.

Bottom Line

ATM fees might seem small and insignificant at first, but they can add up over time. Think about what you can do with the money that you save by avoiding double fees. Take action today by using one of these easy methods mentioned above to keep more of your money and allow it to work for you.