The offers on this page are from advertisers who pay us. That may influence which products we write about, but it does not affect what we write about them. Here's an explanation of how we make money and our Advertiser Disclosure.

Why do some banks charge monthly maintenance fees?

Plus, how to get monthly maintenance fees waived.

Yahoo Personal Finance· Getty Images
4 min read

A bank account can help you manage your money and keep track of your income and expenses, but depending on the type of account you have and the bank you choose, your account may have a monthly maintenance fee.

The good news is that there are plenty of financial institutions that don't charge this recurring service fee, and those that do often provide a way to get the fee waived. Here's what you need to know.

Also called a monthly service fee, banks charge this fee simply for the privilege of having the account.

You're most likely to find one on a checking account or money market account, but some banks may also charge a monthly fee on a savings account if you don't meet certain balance or transfer requirements.

Monthly maintenance fees are more common among national and regional traditional banks. They typically range from $5 to $25, depending on the type of account and the financial institution.

Banks are for-profit financial institutions, and they primarily make money through various fees and interest charged to customers. A monthly maintenance fee is just one of the many revenue sources for banks.

That said, not all banks charge them. In fact, you're more likely to find monthly maintenance fees with traditional banks than online banks and credit unions.

Traditional banks often have a large network of physical locations, which can be costly to maintain. Online banks, on the other hand, typically don't have the same overhead costs because they don't have a physical footprint.

Like traditional banks, credit unions have physical locations to maintain. However, they're not-for-profit organizations, meaning they return their profits to their members through lower fees and better interest rates.

Depending on your situation and needs, there may be a few different ways you can avoid paying a monthly service fee on a bank account.

If your bank charges a monthly maintenance fee, check to see if you can get it waived by meeting certain criteria. Potential requirements can vary depending on the account and financial institution, but here are some general guidelines:

  • Minimum balance: You may need to maintain a minimum daily balance or average monthly balance set by the bank. A minimum daily balance is the amount you need to have in your account at the end of each business day, while an average monthly balance is the sum of ending balances for each day divided by the number of days in the month.

  • Direct deposit: The bank will set a minimum monthly direct deposit requirement, typically a dollar amount. You may also need to receive a minimum number of direct deposits.

  • Relationship: In some cases, banks may waive monthly maintenance fees for customers who have other eligible accounts with the bank or have a significant amount of money held with the bank.

  • Age: Some banks automatically waive the monthly service fee if you're under the age of 24 or over the age of 65.

  • Military: If you're an eligible member of the military community, you may qualify for a fee waiver even if you don't meet other requirements.

If you're a new customer, note that some banks may automatically waive the monthly service fee for the first few months, giving you time to meet the standard requirements to avoid the fee after that.

Many banks offer multiple checking account options, each with different tiers of features and costs. In some cases, the lowest-tier account won't charge a monthly service fee, or it'll make it easier to get the fee waived.

Read more: The 10 best free checking accounts available today

If you're choosing an account for savings needs, a money market account may offer a higher interest rate than a savings account, but that might not be worth it if the account charges a monthly fee that you can't get waived.

In that case, you may be better off with a fee-free high-yield savings account.

If you don't want to jump through hoops to get a monthly charge waived, or you simply want to avoid the prospect of monthly maintenance fees entirely, shop around for a bank or credit union that doesn't charge a monthly fee on any of its accounts.

Read more: The best checking account bonus offers and promotions today

If you're worried about losing value with a no-fee checking account, think again. Some of the best free checking accounts offer features you may not be able to get with a traditional checking account, such as interest on your balance, ATM fee reimbursements, broader ATM access, and possibly even debit card rewards.

If you're paying a monthly maintenance fee on your bank account, now may be a good time to look at other options. While it may be possible to get your monthly service charge waived, you may also consider other accounts and financial institutions that don't come with an account fee.

While that may require you to switch your banking relationship from one institution to another, the long-term savings and other benefits you may enjoy can make it worthwhile.