What are checking account monthly maintenance fees?

Woman at home in a sunlit room, wondering what a monthly maintenance fee isImage: Woman at home in a sunlit room, wondering what a monthly maintenance fee is

In a Nutshell

Many banks charge monthly maintenance fees on checking and savings accounts — an expense that can add up quickly. But some banks waive those fees under certain circumstances, enabling people to avoid this charge each month.
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It’s an ironic reality of banking: You may have to pay in order to use your own money, even if you open a “free” account.

Both online and brick-and-mortar banks may charge monthly maintenance fees (among other types of fees), which can easily add up over the course of the year. But you may not be stuck having to pay them.

Here’s a look at what monthly maintenance fees are, where you can expect to see them and how much they cost on average. Want to avoid these fees altogether? We’ll cover a number of ways to do so.

What is a monthly maintenance fee?

A maintenance fee is a charge that account holders may incur monthly just for having a checking account with a financial institution. Not every financial institution charges these fees (though many do), and they may not apply to every type of account offered. And those that do charge monthly maintenance fees often allow account holders to avoid them by meeting certain requirements.

Banks are required to disclose any monthly maintenance fees upfront. So when you’re shopping around for a new checking account, read the fine print carefully to see which fees you may incur and if there are ways to avoid them. If so, take a moment to determine if you can meet those requirements and save yourself the cost.

Which banking products have monthly maintenance fees?

You’ll often see monthly maintenance fees associated with personal checking and business checking accounts. But some banks also charge monthly fees for savings accounts.  

You typically won’t find monthly maintenance fees associated with products like certificates of deposit, or CDs (though those types of accounts have other fees and penalties to keep in mind and avoid).

Why do banks charge monthly maintenance fees?

Charging monthly maintenance fees may help banks offset some of the costs involved with day-to-day operations and certain account features (like ATM reimbursement or rewards on daily transactions). Fee waivers might entice new customers to make larger deposits each month, hold larger balances, and even use their account with greater frequency.

Financial institutions, like any other type of business, need to make money to survive. Monthly maintenance fees likely contribute to a bank’s bottom line, helping it turn a profit and cover its operating costs.

What is the average monthly maintenance fee?

Maintenance fees can vary from bank to bank, but a 2020 Bankrate study found that the average monthly fee is $15.50 (an all-time high).

Monthly maintenance fee amounts can depend on a few factors, including the financial institution, type of account (checking, savings, etc.) and where you live. Here are some monthly maintenance fees that a handful of large financial institutions charge (as of Dec. 10, 2020).

Financial institutionRange of monthly maintenance fees (based on type of account)
Bank of America$4.95–$25
Wells Fargo$5–$30
U.S. Bancorp$0–$24.95

Because bank rules and charges can vary, you’ll want to shop around when opening a new account. Find the checking account that offers the services and features you need with the lowest monthly fee, or that makes it easy for you to get the fee waived. And keep in mind that many banks offer more than one checking account option, each with its own fees and requirements.

Some financial institutions — mostly online banks — don’t charge maintenance fees at all, although other types of fees may apply to their accounts.

And even if your chosen bank does impose monthly fees, there are often ways to bypass these charges altogether.

How can I avoid monthly maintenance fees?

The easiest way to avoid being charged a monthly maintenance fee from your banking institution is to choose a bank that doesn’t charge this fee in the first place. Free checking and savings account options are available.

And if you find an account that you want at a bank that does impose monthly fees, that bank may offer ways to avoid them. Typically, this involves meeting certain requirements for how you manage your funds.

Banks may offer to waive your account’s monthly maintenance fee if you …

  • Keep enough money in the account. Some banks will waive a monthly fee as long as you keep a certain balance in your account, either a minimum daily balance or an average daily balance requirement over the course of the month. You may also qualify for a waived fee if you meet a combined balance requirement across multiple accounts.
  • Accept monthly direct deposits. If you make a certain dollar amount in direct deposits in a month, your bank may waive the maintenance fee on the account for that statement cycle.
  • Have other products or accounts from the same bank. You might get your monthly fee waived if you have other qualifying products, services or accounts from the same bank, such as a home mortgage, personal loan, credit card or even a connected or investment savings account.
  • Are of a certain age or attend school. If you’re under a set age limit or student, you might qualify to have your monthly fees waived. Each bank has different age limits, and some waive fees for either high school students or college students (or sometimes both).

Next steps

Shopping around thoroughly before choosing a new bank account can give you a chance to hold onto more of your hard-earned money. Consider how you typically bank, including your average daily account balance and whether or not you receive direct deposits.

Then, be sure to compare the features that are most important to you, like a high interest rate, ATM fee reimbursement and rewards on daily transactions. You should also examine whether the bank is FDIC-insured, offers overdraft fee protection or has in-branch banking (if desired).

Keep in mind that your banking needs may change over time, along with your habits and financial situation. If you ever begin to feel that your bank account isn’t the right fit — or your account benefits don’t outweigh what you’re spending in monthly maintenance fees — it may be time to switch accounts.

About the author: Stephanie Colestock is a personal finance writer with a passion for helping readers take control of their money. If it has to do with planning for the future, getting out of debt, or even traveling the world on points… Read more.