Say Goodbye to Free Checking?

Last Updated Jun 17, 2010 11:20 AM EDT

Bank of America and other banks are getting ready to raise fees on checking accounts and other basic banking services, according to a report this morning from the Wall Street Journal. That's no surprise: Banks are in it to earn money, and if they can't soak you with credit card fees or sell you expensive and bad mortgages, they'll find other ways to profit. Free checking may become a thing of the past.

That's especially bad news for the unbanked -- folks who live paycheck to paycheck and already have trouble scraping together the cash needed to open a bank account. It puts FDIC-backed security further out of reach and makes them prey to expensive check-cashing services.

But even people who can afford to pay monthly charges for checking may not want to. Here are some options.

  • Join a credit union. These membership organizations tend to have lower fees and better interest rates, though they don't always have the most sophisticated bill pay options or ATMs. There's probably at least one credit union that you qualify to join; find them at
  • Comparison shop. There's still some competition in the banking world, so if you think your bank is getting too expensive, find another. Shop at or to find other accounts that may have lower fees or free checking.
  • Take it to the cloud. If you get your paycheck direct deposited and pay your bills online, you may not even need a bricks-and-mortar bank. So why pay for one? Use the comparison sites above to search for an internet-only bank that will pay you interest and rebate ATM fees.
  • Consolidate, to a point. Keep your emergency fund, your checking account, and your credit card at the same bank. If you have any other accounts, such as a separate checking account for eBay transactions or a side business, keep that at the same place, too. Then ask the branch manager whether you can avoid fees because you're such a loyal customer. But don't let that loyalty extend to your investment accounts, too. Bank investment services are often tied to pricey (and commission-charging) brokers. Shop for your investment services separately.
  • Just suck it up. A good bank with convenient ATMs and an easy to use online bill pay program is a great convenience. Accept that you'll have to pay for it and worry about saving money somewhere else -- like on your cable bill.

Photo by Swimparallel on Flickr.

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