Are you paying too much to access your cash?

Please note, this blog was originally posted on my personal site ( back on 10/29/2015.

From payment platforms like Paypal and Venmo to digital wallets like Apple Pay and Google Wallet, it seems like the need for physical greenbacks will soon be going the way of cassette tapes and your Myspace account. And with the emergence of Bitcoin, even the concept of money itself is being challenged.

However, before you get into your self-driving vehicle and head off into this currency-less digital future, there is still the need to pay your local sandwich shop, feed the meters, and pay highway tolls. These types of vendors are not be able to accept payments from leading edge technologies like your slick new Apple Watch. When you find yourself in a bind and need some cash, your first reaction may be to pop your head up, look for the nearest ATM, and pay whatever fees are necessary to complete a transaction. While there are two primary fees to be aware of, there are options to avoid these charges altogether.

What is the ATM Double Whammy?

The Double Whammy occurs when you are hit with both an ATM surcharge fee and the out-of-network fee. You are probably aware of the first fee, which is what the ATM operator charges for using its machine. This is the fee that flashes on the screen and says, “We are going to charge you $3.99 for this transaction. Press Yes to accept.” According to a study conducted by the US Government Accountability Office (GAO), these fees range from $0.45 to $5.00 and average $2.10 per withdrawal. 

The other fee, which is often less obvious, is the out-of-network fee and is charged by your bank for cheating on them. This fee shows up on your monthly bank statement and, according to the GAO, averages $1.42 per transaction.

You may tell yourself that you don’t have to worry about this because you belong to a global bank like Wells Fargo. But be warned, these banks are struggling to control their costs and are increasing fees to non-members. The GAO reported these non-member fees increased 20% between 2007 and 2012. In addition, these banks are closing physical locations with BofA recently shuttering 500 branches and 300 ATMs.

Options to Avoid the Fees

Here are the most common ways to access your cash and avoid these punitive fees.

  1. Use in-network ATMs (Tip: Many banks have apps that will show you the location of their nearest ATM).
  2. Use linked credit union ATMs. Credit unions are often part of affiliated ATM networks. For example, Alliant Credit Union offers a network of over 80,000 fee-free ATMs.
  3. Get cash back at a grocery store or gas station. While this may be a small annoyance for the teller, you can make a small purchase (like a pack of gum) and request cash back. You can walk away with fresh smelling breath and two fresh $20 bills.
  4. Sign up for a fee-free checking account (more on that below).

Fee-free Checking Accounts

In order to attract new customers, some banks offer checking accounts that will reimburse the ATM surcharge fee and do not charge you for going out-of-network. Signing up for a fee-free checking account is one of the most empowering steps you can take in personal finance. There is nothing like being able to walk up to any ATM in the country, withdraw money, and have your bank pay you back for any ATM fees. AllySchwab, and Fidelity all offer checking accounts with this feature (Note: Ally only reimburses up to $10 for ATM fees per month). For those globetrotting travelers out there, Schwab will even reimburse for foreign ATM withdrawal fees. 

The Bottom Line

Stop paying unnecessary fees to access your own cash. There are a variety of products that offer fee-free ATM withdrawals. For additional options, visit Nerdwallet or  

Views expressed in this post are that of Shawn Tydlaska, CFP(r), MBA. Shawn is a Certified Financial Planning pro and graduated from University of Michigan Ross School of Business. This blog is for informational purposes only and should not be considered a recommendation or endorsement to a particular investment or strategy.