Columbia, SC (WLTX) - Several banks are raising their debit card fees and even charging to have a checking account, but can consumers get around them?
Banks are trying to recoup losses from the Card Act passed last year which limited their ability to raise rates and charge overdraft fees. Bank of America has said they needed to start charging because they have to offset the cost of billions of dollars in bad mortgage loans.
You can compare it to the airline industry - a lot of their ticket prices didn't go up but they did start charging for other things like baggage fees, snacks, etc.
"We are starting to see free checking go the same way as the free airline meal," explained Alex Chastain, a financial advisor for Abacus Planning Group in Columbia. "They are trying to increase revenues because they are companies and they want to show profit. They need to show profit to their shareholders ."
Currently, many big hitters are leading the way like Bank of America and Sun Trust but others will likely follow suite.
"To see a majority start to charge a fee, or the majority charge a fee, it really opens up the flood gates for maybe others to charge a fee. If one's doing it, the other one's going to do it as well."
There are other options out like online banking and credit unions.
"An online bank is a company where you truly do all your banking online. There is not a branch that you can go visit. They tend to have the lower fees, sometimes have higher interest rates." Chastain said that there are some disadvantages, though.
"You're not going to develop the relationship that exists by having a bank and someone to go into."
Credit unions are not-for-profit organizations and tend to have lower fees.
"They tend to still be the group who has free checking available, lower fees, higher interest rates on checking accounts, lower rates on vehicles to finance."
The downside is they're not as easy to access from another state.
"Most people naturally get frustrated when you have something that was once free and now you're paying for it. "
Even though these fees are making plenty of people upset there are choices.