Are you racking up unnecessary ATM fees?
The three main ATM fees and how to avoid them.
27 January 2016: A surcharge or convenience fee is usually associated with ATM cash withdrawals. The owner of the ATM may charge the user a fee for using its ATM. It’s designed to cover the operating, maintenance and supply cost. ATM’s are required by law to inform you of this fee and the amount of the fee can vary depending on the ATM.
Foreign fees are the second primary ATM fee. Your bank or credit union will charge you when you use an ATM that is outside of your ATM network, but in Australia. This fee is not assessed by the machine. Your financial institution sets the fee and this information is disclosed to cardholders of that institution.
When you travel overseas, there is a high chance you’ll be charged for withdrawing money from ATMs. Most people, when they travel, withdraw twice a week from an ATM. Get familiar with your bank’s fees and know how much it will charge you when you’re overseas. For example, the Citibank Plus transaction account charges no fees at all for transactions made at Citibank-branded ATMs worldwide. The Westpac Choice account also doesn’t charge any overseas ATM fees if you use an ATM in it’s global network.
- Surcharge or convenience fee
- Foreign fee
- Overseas ATM fee
So how can I avoid these fees?
Here are some of the best ways to save money and avoid unnecessary ATM fees:
- Use ATMs in your network
Your bank has numerous machines set up over the country. There’s no doubt there would be a few ATMs near your home. Most people make withdrawals from machines when they are near home or on their way to work. So find ATMs that are in your network and withdraw your cash from them. Using other machines will cost you more. When you go overseas, try and withdraw cash from ATMs that are partnered with your bank. Machines that are partnered with your bank have lower or no fees depending on the institution.
Commonwealth Bank is currently the largest provider of ATMs in Australia. Commbank is also partnered with Bankwest and provide access to over 4,000 ATMs in Australia free of fees if you belong to Commbank or Bankwest. The second largest network belong to rediATM, who have partnered with over 100 financial institutions.
- When you go shopping ask for cash-out
When shopping, you can be asked, “Would you like to take some cash-out?” This is an easy alternative than going to an ATM. Avoid machine fees when you take out cash when you go shopping. Some machines can charge up to $5 for an operating fee. Avoiding ATMs in general could save you money.
- Pay your bills using BPAY
Using BPAY is convenient and easy to use if you decide to pay your bills with this method. When you pay over the phone or on the Internet, you’ll be avoiding the ATMs and the fees attached to them.
- Step up the amount you withdraw
This may seem like a counter-intuitive idea, especially if you’re on a budget. However, some ATMs offer a deal where if you withdraw a certain amount you will not be charged the ATM fee, such as the ING Orange Everyday account.
So while most people often withdraw $20 or $50 from an ATM, try raising that so you don’t have to pay the fee. Check with your bank to see if you can receive this service. Plus if you withdraw more at one time, you will save yourself going on more trips to the machine.
- Use electronic sources for your transactions
Use your phone or Internet service to do your banking. In doing this you'll avoid all the machine fees.