1. Headline
  1. Headline
updated 10/30/2006 5:50:37 PM ET 2006-10-30T22:50:37

Making a mistake with your checking account can cost you a lot of money these days.

  1. More from TODAY.com
    1. 'Happy' dancing kid at steals the spotlight at basketball tournament

      Sometimes the best entertainment at sporting events isn't on the court. This was the case last week at the Kentucky High S...

    2. Want to be 105? Check your genes
    3. 'Spampocalypse': Mass-email chain sparks emotions, jokes and a picnic
    4. Romney talks boxing, going 'all Putin on' Savannah in first Meerkat
    5. 'Holy cow!' Drew Barrymore talks 'saggy and weird' post-baby body

A survey of banks in 25 large American cities by Bankrate.com, an online financial information service, found that the average fee for a bounced check has hit a record $27.40, up from $27.04 in the previous survey last spring.

At the same time, the average surcharge at automated teller machines, or ATMs, has jumped to an all-time high of $1.64 from $1.60 in the spring and $1.54 a year ago, the study indicated.

“What makes these fees especially irritating is that they’re avoidable,” said Greg McBride, senior financial analyst with Bankrate.com. “It’s something that pops up and bites you when you’re not careful.”

Consumers can avoid bouncing checks by remembering to track the use of their debit cards, which generally are linked to checking accounts, and by keeping their checkbooks balanced, he said.

And ATM surcharges can be avoided if consumers plan ahead and get cash from their own bank’s machines and not those of other institutions.

“What the study indicates and that when you use somebody else’s ATM, you have to pay dearly for the privilege,” McBride said.

The biannual survey by Bankrate.com, which is based in North Palm Beach, Fla., also looked at interest and non-interest checking accounts offered at nearly 250 financial institutions.

When it comes to checking accounts, the bottom line is that those that pay interest generally require higher initial deposits and higher minimum balances than those that don’t pay interest, McBride said.

But the interest that most pay — averaging just 0.34 percent — “is so dreadfully low it’s not worth it,” he said.

“By settling for average interest earnings of 0.34 percent instead of the 5 percent returns available in a savings or money market account, the consumer forfeits more than $100 per year in interest earnings on a $2,500 balance,” Bankrate.com pointed out.

The study found that for interest-paying checking accounts, the minimum opening deposit rose to about $615 in the latest survey from about $430 in the spring — a 43 percent jump. The minimum balance that must be maintained to avoid fees was $2,660, it said.

Meanwhile, checking accounts that don’t pay interest required opening deposits averaging about $88 and minimum balances to avoid fees of about $210.

“More than 60 percent of non-interest accounts have no balance requirement or monthly service fees,” McBride said. “That’s what you want in a checking account — not a token amount of interest earnings.”

The average monthly service fee for interest-bearing accounts was $10.74, while the average fee for non-interest accounts was $2.50, the study showed. Both were down from the spring survey.

“People should look at these service fees because they can really add up over the course of a year,” McBride said.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

More on TODAY.com

  1. Getty Images file

    'Holy cow!' Drew Barrymore talks 'saggy and weird' post-baby body

    3/26/2015 4:23:11 PM +00:00 2015-03-26T16:23:11
  1. Nick Briggs

    'Downton Abbey' — and the Dowager Countess! — is saying goodbye

    3/26/2015 5:25:05 PM +00:00 2015-03-26T17:25:05
  1. Matt Murray (Nbcuniversal)

    ‘Happy’ dancing kid steals the spotlight at basketball tournament

    3/26/2015 9:23:23 PM +00:00 2015-03-26T21:23:23
  1. AP; Getty Images

    1D disaster: Without Zayn, Harry and fans break down

    3/26/2015 12:21:37 PM +00:00 2015-03-26T12:21:37
  1. Want to be 105? Check your genes

    3/26/2015 10:12:29 PM +00:00 2015-03-26T22:12:29