Most people, 72%, do not pay bank fees at all, but those who tend to be the ones who can afford the least, the report found. In general, the average US checking account holder reports that they pay less than $ 8 in fees, including service fees, ATM fees, and monthly overdraft fees.
However, households that suffered a revenue setback during the pandemic – whether it was job loss or reduced hours – pay an average of more than $ 11 a month in checking account fees. Meanwhile, account holders say their household incomes have not been affected by the pandemic report, paying an average of less than $ 3 a month.
“Those whose personal finances have been adversely affected by the pandemic have been hit twice by higher bank charges,” said Mark Hamrick, chief economic analyst at Bankrate.com. “Unemployment or loss of income can be devastating, but we should try to avoid bringing financial insults to harm by paying too much bank fees when there are so many less expensive options.”
Those already disproportionately affected by the pandemic, especially people of color, also pay higher bank fees.
While white checking account holders report paying fees of $ 5 a month, blacks and Hispanics pay more than twice that amount, at $ 12 and $ 14 a month, respectively. Holders of white checking accounts are also much more likely to say they pay nothing in monthly fees, with 79% paying zero monthly for checking, while only 56% of blacks and 50% of Hispanics pay nothing on month.
Younger people pay more for their checking accounts than older people. Millennial checking account holders between the ages of 24 and 39 report paying $ 15 a month. Gen Xers – aged between 40 and 55 – pay $ 6 a month, while Baby Boomers, aged 56 to 74, pay only $ 2 a month.
The average overdraft fee reached a record $ 33.47, while the average total cost of using ATMs in the network dropped slightly to $ 4.64, the report said.
More people turned to mobile banking in 2020, with 64% reporting that they adapted their payment practices to using online methods more frequently as a direct result of the pandemic.
“Many consumers are playing smart, in fact, engaging in social distancing with their banking and payment technologies,” Hamrick added. “Once we get out of the pandemic and the economic recession, it will still be wise to take advantage of new mobile banking technologies not only to save time, but also to help maintain account balances and fees, as well as potentially expensive account overdrafts. and fraud. “
The report found that the average account holder has been with their institution for more than 14 years. There are now more options to explore when doing banking, with many regional banks, online banks and credit unions, as well as large banks offering checking accounts with little or no fees.