Checking Account Fees Not Yet on the Rise, According to Bank Survey

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Leading financial education Web site released the results of its semi-annual checking account fee survey, which suggest that checking account fees are not on the rise, despite recent anecdotal evidence to the contrary. In the third and fourth quarters of 2009, the average checking account monthly maintenance fee among a sample of banks in New York state actually decreased from $6.63 to $5.90, an unexpected drop of 11.01 percent.'s latest semi-annual survey of checking account charges and fees reveal that monthly maintenance fees actually fell in the latter half of 2009. Although recent stories have been predicting the wholesale rise of checking account fees as banks try to offset losses in other businesses, the survey data cast doubt on this assumption.

The average monthly maintenance fee among 195 checking account products at the end of 2009 was $5.90, down from $6.63 in July 2009. For the latest survey, financial institutions in New York state provided monthly maintenance and overdraft fee data for 195 checking account products. While banking practices and fees differ from state to state, New York includes a wide enough variety of account types and a large enough sample of institutions to provide a reliable view of banking trends nationwide. A more detailed analysis of the results of the bank fee data can be found at

Why is scrutinizing monthly fees so important to depositors? columnist Richard Barrington points out that a seemingly innocuous monthly maintenance fee of $6 on an account with an average balance of $500 is an annualized charge of 14 percent.

"Remember, that's not for borrowing money," said Barrington. "That's a fee for letting the bank use your money. Fortunately, there are still a number of accounts which have no monthly maintenance fees. So, it's worth shopping around--you'll pay dearly if you don't."

Indeed, 87 of the 195 checking accounts in the survey came free of monthly maintenance fees. The number of free checking accounts available should encourage consumers to shop for the best deals. Moreover, monthly fees varied widely, from no fee to $25 per month, making it all the more important to compare accounts and institutions.

Although monthly fees did not rise, what did increase in the last two quarters of 2009 was the minimum balance required by many banks to avoid a monthly fee. This average minimum balance rose from $4,284.88 in July 2009 to $4,621.05 in December 2009. Of course, checking accounts with zero monthly fees but higher balance requirements are not quite "free," and charges for overdrafts or frequent banking activities--such as teller transactions or use of out-of-network ATMs--can still catch depositors by surprise.

Two checking accounts from the latest survey illustrate how zero monthly fee accounts don’t necessarily mean zero rewards. Tioga State Bank’s Rewards Checking account and Evans National Bank’s Better Checking account were among the 87 checking products with no monthly maintenance fee. Both offered a low $25 minimum balance to open the account and an interest rate of 4 percent and 3 percent, respectively, to checking customers who were able to meet certain requirements such as direct deposit and a minimum number of debit card transactions. These offers show that comparison shoppers don’t have to settle for average deals and also demonstrate the importance of understanding account conditions and how well they match an individual’s banking behavior.

Said Barrington, "Whether you'll actually get lower fees depends greatly on how you use the account. Ultimately, smart shopping is your best protection from rising bank fees."

Offers and interest rates quoted are accurate as of the survey date, but customers are encouraged to confirm terms and conditions with the bank. Accounts may not be available to depositors in all states.

Visitors to can access educational articles and compare checking account interest rates and charges. has been a leading source of information on bank rates, personal finance, savings accounts and investing since 1999. The site provides the highest rates on certificates of deposits, money market accounts and high-yield savings accounts.

Richard Barrington is available for interviews on this topic and other topics relating to personal saving and investing. To interview Richard, please contact:

Jessica Austin


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