NerdWallet Bank Fee Monitor: Average Big-Bank Checking Account can Cost $110 a Year

Following the new and threatened fees from Wells Fargo and Bank of America, NerdWallet conducted a study to analyze the current state of the top 5 banks’ checking account fees and requirements by comprehensively combing through every account offered (3-8 checking accounts per bank) and the 50+ fees and requirements associated with each account.

This index of bank fees is the first installment NerdWallet’s Bank Fee Monitor, which will track all the changes in checking account fees, both publicly announced and quietly slipped in.

Monthly fees: No direct deposit? No large balance? No free checking.

While all top 5 banks have at least one basic checking account that will waive monthly fees if a consumer direct deposits or maintains balance minimums (usually $1,500) – for basic accounts, there is little flexibility or variation in conditions to waive fees.

• Big banks charge an average of $110 a year if consumer can’t meet conditions to waive
• Lowest: Wells Fargo ($60/year); soon to be $84 a year in some states
• Highest: Chase ($144/year)
• Range: $60-$144 a year for basic accounts; $131-$360 for premium

Checking accounts are getting classier

NerdWallet’s study confirmed the abundance of higher tier account offerings, geared towards getting consumers to deepen their financial relationships with the bank and buy more products

• All top 5 banks have at least one “higher tiered” account aimed to encourage use of additional products – US Bank and Wells Fargo have 4-5
• All top 5 banks waive monthly fee for such accounts; many fees are ones that likely don’t pertain to consumers that can maintain $5,000+ in their accounts, including: insufficient funds fee, overdraft protection, stop payment, returned items

Overdraft fees

• Averaged $31.60 on standard checking accounts, but are often waived on premium accounts
• Lowest: Wells Fargo – $15 for teen accounts and $25 for other accounts
• Some banks, such as Chase, HSBC, and US Bank, waive small overdrafts that are under $20 or so

What to do?

If you don’t meet any conditions to waive, one potential consideration is how comfortable you are with self-service and online options. If you’re comfortable with doing all your banking online or through ATMs (no tellers or walking into a branch), there are a few good options for you – both at traditional banks and internet-only banks, including:

• Traditional banks: PNC’s Virtual Wallet or Bank of America’s eBanking accounts both allow you to waive monthly fee for agreeing to only transact online
• Internet banks: Ally Bank’s Internet Checking Account not only has no monthly fees but also allows you to earn interest. We like ING too

Those that like the reassurance of being able to walk into a branch (nothing wrong with that) should consider switching to a credit union. Many credit unions have open membership and lower fees. We like Alliant and Kinecta.