Hacker News Reader

Comment by navait | Hacker News Reader

The fee seems a bit egregious, even for commercial banking. My bank never charged me for a checking account, and even reimburses ATM fees.

View on HN

ditto. Always been free for me. I didn't know that wasn't the norm.

It is the norm, unless you're poor...

It would be interesting as a study to go through and calculate how much more a poor person pays per year for the same level of service just because they're poor (e.g. higher car payments, no 0% APR offers, account fees, etc).

Upshot at the NYT did an article on checking fees through this lens recently:

http://www.nytimes.com/2014/09/21/your-money/in-checking-acc...

Not sure if it's paywalled, so the gist is that for relatively affluent folks, the annual cost of a checking account is ~$18. For the "cash-strapped" it's closer to $500.

Obviously that's just checking accounts, but I wouldn't be surprised to learn that many other things are more expensive for the poor as well.

That $18 is probably just the cost of checks, too. I have never paid for a checking account, but one of the reasons why is that the "free" stuff requires a minimum balance (Wachovia --> Wells Fargo) at a lot of banks. I have had an eTrade bank account since around 1997 when I signed up with Telebank, and have been very happy with them, too. They refund all ATM fees, and it's easy to keep it adequately funded via scheduled transfers from my primary bank (which conveniently also holds my mortgage), and since my employer uses eTrade to service its ESPP and Options programs, it's convenient to make trades there, too.

If you have less than $x balance or $y/mo in direct deposits, most banks charge a fee. Because what someone who makes less than $1,000/mo really needs is to pay over $100/year for a checking account. That's not including all the likely overdraft/returned item fees someone with an average balance of less than $1,000 is likely to achieve.

How it doesn't violate usury laws to charge someone $35 for a $5 overdraft, I'll never understand.

There are many banks where this isn't the case and you should never pay for a checking account, regardless of how much money you have coming in every month. I even have a Wells Fargo (canonical "big bank" example) checking account that has been sitting with $16.09 for the past 6 months.

Do not pay for a checking account, ever. If your bank is charging you a fee for your account, call them and say "I can get a free checking account at X competitor, I am going to switch to them unless you can match that."

Hell, Charles Schwab offers a free checking account and will refund ALL ATM fees every month.

Didn't the gov't kill the usurious overdraft charges? I don't follow American news too closely anymore but I remember hearing rumbling about that... iirc that's why American banks started moving over to the model I see here in Canada - large minimum balance or ~$10/mo in monthly fees.

I'm not sure about the overdraft charges, but they did require the default for debit cards to "deny" a charge if it would result in an overdraft. So I won't overdraft my account by accident if, for example, I try to buy a $2 drink before my paycheck clears. (Happened once...)

Reply on news.ycombinator.com