Bank Fees: Most & Least Costly States

Think you pay a lot in bank fees? Don't move to West Virginia. The Mountain State has the dubious distinction of being the nation's most costly place to bank, according to a new analysis by the Pew Center in Washington, D.C..

Where the average American pays $8.95 a month to maintain a checking account if they don't meet minimum balance requirements, the fee in West Virginia is 34% higher -- $12 a month, or $144.00 a year. That's more than 140% more than the cost of keeping a checking account in the least-expensive states, where the median monthly fee is just $5.

Banks will waive monthly checking fees if you keep a minimum balance, but that's also tough to do in West Virginia, where the state's residents are required to park $10,000 in their accounts versus the national median of just $2,500. Meanwhile, the smallest median balance requirement is in Vermont, where the median checking account is fee-free with a mere $100 minimum balance.

"One of the interesting findings of the study is that there is very little consistency in pricing from state to state," says Ardie Hollifield, project manager for the Safe Checking in the Electronic Age Project at the Pew Center.

Even though the same 10 banks were surveyed -- they account for about 60% of all the nation's bank deposits -- banks charged different rates in different states, she says.

The Pew Center opted to conduct the research following their April bank fee report, which concluded that bank disclosures were confusing and lacked transparency, particularly with regard to overdraft costs and options, which made it difficult for consumers to shop. The report found that the one area where fees appear fairly consistent is with overdraft fees. The median is $35 -- about $1 less than the median amount of overspending that triggered the overdraft fee. The fee to transfer money from a linked account to avoid the overdraft fee is generally $10, though banks in a handful of states charge just $5.

The Pew Center wanted to publish the data for the benefit of policy-makers, who might want to see how fees could push lower-income consumers out of the banking system. But it can also be used as a measure to see how your bank stacks up, Hollifield says. If your bank requires vastly higher minimums than the average in your state, or charges much higher fees, it might be time to shop around.

Pew has an interactive State-by-State map on its web site where you can look up your state's bank fee numbers. But the map doesn't provide an easy way to benchmark highest-to-lowest, so we've crunched the data to provide listings of where you'll find the highest and lowest monthly fees; minimum balances; and overdraft charges below.

Monthly fees: National median, $8.95
Highest median monthly fees:
$12 - West Virginia

$10 - Alabama, Alaska, Florida, Maine, Massachusetts, Michigan, Mississippi, New Hampshire, Vermont.

$9.50 - Washington, D.C.

Lowest median monthly fees:
$5 - Minnesota, Montana, Nebraska, North Dakota, South Dakota and Wyoming

$6 - Colorado, Kentucky, Ohio, Utah and Wisconsin.

Minimum balance requirements: National median, $2,500
Highest median balance requirements:
$10,000 - West Virginia and Kentucky

$5,000 - Alabama, Arizona, Arkansas, California, Colorado, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Montana, Nebraska, Nevada, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, South Carolina, South Dakota, Tennessee, Utah, Washington, Wisconsin & Wyoming.

Lowest median balance requirements:
$100 - Vermont

$1,500 - Alaska, Connecticut, Delaware, Louisiana, Maine, Mississippi, New Hampshire, New Mexico, Rhode Island and Texas.

Overdraft fees: National median, $35 overdraft
Lowest median:
$31 - Alaska

$33 - Minnesota, Missouri, Montana, Nebraska, North Dakota, South Dakota, Wyoming.

Highest median:
None above the median, but 26 states charge the median amount of $35.

Overdraft transfer fees: National median, $10
Lowest median:

$5 - Kentucky, Minnesota, Missouri, Montana, Nebraska, North Dakota, South Dakota, Wyoming.

All other states charge the median amount, according to the Pew Report.

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