3 Mega-Banks Screwing You With Sneaky Fees -- Again
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If you're a lower-income Bank of America customer -- someone without a mortgage who doesn't keep a ton of cash in reserves -- you can expect to pay more, probably sooner rather than later. Facing declining revenue, Bank of America CEO Brian Moynihan "is determined to plow ahead," according to the WSJ. (Another reminder of just how expensive it is to be poor.)
Meanwhile, Bank of America and its competitor Chase have both admitted they will also begin focusing more attention on wealthy clients ( in Chase's case, customers with at least $100,000 in the bank) and less attention on lower-income clients who make the bank less money, potentially pulling out of markets that are lower income.
"Both Chase and Bank of America have publicly said that they want to focus on up markets and abandon the mass markets," PerkStreet Financial's Dan O'Malley told U.S. News & World Report. "They're trying to push out the typical average American from the bank and focus on the wealthy instead because they don't make as much money off of the average American."
So not only will lower-income customers potentially be slapped with more fees, they'll also have fewer big banking opportunities in general.
2. Wells Fargo starts charging $15 per month for non-wealthy checking customers.
Wells Fargo was one of the banks to reverse its plan to charge monthly debit card fees after this fall's Bank of America PR debacle.
But just a few weeks later, Wells Fargo was rolling out new, different fees. In November, the bank started charging a $15-per-month fee to checking customers with less than $7,500 in their account or with less than three accounts at the bank.
3. Citibank's fees go sky-high.
Not deterred by the outcry over Bank of America's $5 fee, in December Citibank announced it would begin charging $20 per month to mid-level checking customers with less than $15,000 per month in the bank (up from the previous $6,000 minimum). On top of that, the bank started charging its EZ checking account customers $15 per month for keeping less than $6,000 in the bank. Also, the monthly fee on Citi's Basic Banking account went up $2 per month, to $10, and there are now additional ATM fees for many Citi customers using non-Citi ATMs.
What should big bank customers do about these fees? One obvious solution is to stop doing business with these banks.
The Move Your Money campaign has been hugely popular since the start of the Occupy movement, with a reported 5.6 million customers having ditched their corporate banks since early November. Still, many people have yet to make the leap from corporate banks to credit unions or smaller financial institutions.
Convenience is one of the most-cited reasons for not joining a small bank. Consumers worry they'd have to pay more ATM fees because they'd have fewer money withdrawal opportunities than at a bank like Chase.
As the Move Your Money campaign points out, many credit unions are part of ATM networks like AllPoint that offer tens of thousands of fee-free ATMs around the country. But even if your banking options do become somewhat more limited by joining a smaller institution (and it's true, they probably will to some degree), you have to ask yourself: At what point is the convenience of a mega-bank -- never being more than a few minutes from a branch, for instance -- outweighed by the mega-banks' decidedly inconvenient, ever-increasing fees? Will you really save yourself significant time or money, not to mention mental wellbeing, by staying with your corporate bank?