How to Save Money on ATM Fees

by Ryan Guina

I often traveled when I was in the military, and I could never count on finding an ATM from my bank. Even the largest branches can’t have ATM machines everywhere. The problem with using another bank’s ATM is that you will often get hit with two fees – one from your bank, and one from the bank that owns the ATM. After having multiple fees assessed one too many times, I decided I needed to minimize my ATM fees.

How to minimize ATM fees

Save Money on ATM Fees

Save Money on ATM Fees

Use Your Debit Card to Get Cash Back. This was my favorite way to avoid ATM fees (my current bank doesn’t charge ATM fees, and I get reimbursed for charges from other banks). When you make a purchase with your debit card, many stores will allow you to take cash back on the purchase. The cash comes directly from your checking account as though you were making a cash withdrawal from an ATM or making a purchase.The store gets the money directly form your account, so they don’t mind.

If I needed cash, I would pull over to the closest Wal-Mart, buy a pack of gum, and get $40 cash back. The gum was cheaper than the ATM fees and I had something to show for the expense. Keep in mind that most stores limit your cash back to around $20-50, so this will work for small cash needs, but not if you need a lot of money.

Pull out a lot of money at once. If I couldn’t get cash back from a debit card purchase or I needed more money than I could get from the debit card purchase, I would use an ATM. But I would make sure I pulled out enough money to last me awhile. This reduces your ATM fees because you will pull out money less often.

I had a friend who would only pull out $20 when he needed cash (which was several times per week), and he paid 2 ATM fees to do so. At an average of about $3 per transaction, that equaled 15% of his withdrawal! By pulling out $100 once a week instead of spread out over 5 transactions, he would have saved more than $10 per week. That’s over $500 annually! (He stopped doing this shortly after I told him about getting cash back with an ATM card. He now has a fierce chewing gum habit. 😉 ).

Join a bank that doesn’t assess ATM fees. In today’s banking world, banks that don’t ever charge ATM fees are rare… but they do exist. There are even some banks, such as USAA, that will not only don’t charge ATM fees when you use another bank’s ATM, they also reimburse you the fees the other bank charges you to make the transaction (up to 10 withdrawals per month, and $15 from other banks). I rarely go to an ATM anyway, and I have never come close to the max. I haven’t paid an ATM fee in several years.

Don’t pay with cash. I use credit cards for almost every purchase I make. I do this for several reasons, mostly because I use cash back credit cards, it makes tracking expenditures easy with software such as Quicken, and for other benefits of using credit cards, like free extended warranties and fraud protection. In addition to using credit cards, you can pay with a check or your debit card instead of using cash.

It’s your money. Sure, $3 or $4 in fees isn’t a lot, but it can add up quickly (as shown above!). It’s your money. You should keep as much as possible.

Photo credit: ol slambert

Published or updated April 20, 2012.
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{ 8 comments… read them below or add one }

1 Hank

I’ve never even thought of the gum trick before. That’s a great idea.


2 Ryan

Thanks, Hank. I got tired of giving away money, just for the right to have access my money! :)


3 Dividend Growth Investor

I never use cash these days. If I had cash, I would spend it very fast :-)


4 SavingDiva

I’m using Charles Schwab to avoid ATM fees. I also try to avoid cash as much as possible! :)


5 Zhu

I like paying with cash (better budget control) so I usually withdraw CA$300 every couple of weeks or so. I find it the best way to avoid charges…

If I forget to bring cash or if I’m short, I use my credit card, even for small purchases.


6 Lauren

I love the debit card deal, too. Not a gum chewer, but I did need some lightbulbs.


7 Ryan

Excellent way to do it, Lauren. :-)


8 Joan

If you live on the East Coast, WaWa convenience stores have free ATMs for all :)


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