Issue #104: Every time I pay an ATM fee I die a little inside

plus Gordon Ramsay + Gen Z finance
July 28, 2021 • Issue #104
Dollar Scholar
Hi y’all —

When I was in college, I frequented a pizza joint called Satchel’s. In addition to producing a seriously good pepperoni pie, Satchel’s had a reputation among University of Florida students for three things:
  1. Its eclectic decor — if you got lucky, you could eat near the vintage toy shop, under the airplane or in the 1965 Ford Falcon van parked permanently outside the restaurant.
  2. The fact that it mysteriously burned down. Twice. In a five-year span.
  3. It only accepted cash.

That third point was the hardest to contend with because I was never responsible enough to think ahead of time to bring cash. When the bill came, I’d always have to excuse myself from the table, slink to the back of the restaurant and stand in line for the ATM. 

Satchel’s payment policy changed after I graduated (of course they take credit cards now), but my struggle hasn’t. No matter how old I get, I just cannot seem to prepare in advance for the possibility of needing cash. I’m no longer dodging waiters carrying piping-hot pizzas in a crowded hallway at Satchel’s, but I’m still ducking into bodegas to take out cash on the reg — before I grab drinks at cash-only bars, before I have to drive through tolls, before I need to tip at drag shows. And as a result, I pay ATM fees constantly.

I know it’s my own fault, but it seems colossally unfair that I should have to pay money to access my own money.

Is it bad that I pay ATM fees all the time? Where do they even come from?

I got on the phone with Bruce Wayne Renard, the executive director of the National ATM Council, to get some context. He sympathized with me, explaining that he’s read several news reports in recent years about “quote-unquote skyrocketing ATM fees.” But, he says, “the reality is, there are two types of ATM fees out there.”

The first is the ATM surcharge, which typically comes from the small business owner who owns and operates the ATM. By law, the owner has to disclose this surcharge — and give me a chance to cancel my transaction for free before it’s levied. It’s typically like $2 or $3.

“The ATM operator has the cost, which is significant, of keeping this box of money out there in the public,” Renard says. “It’s a very highly sophisticated computer that’s connected to a telecommunications line, and it requires a lot of maintenance and constant loading of cash.”
ATM fees are great because I love buying my own money back from a robot.
ATM surcharges don’t usually increase much because of the way the marketplace works. If the convenience store on the corner has a $2 ATM surcharge, but the one across the street has a $5 one, customers are generally going to pick the cheaper option. Stores can’t significantly raise the cost using their ATM because people will simply go elsewhere.

The other fee is perhaps more objectionable.

“The fees that have skyrocketed,” Renard says, “are the banks’ own fees for using ATMs that are not theirs.”

This is called a foreign ATM fee, but it has nothing to do with traveling to another country, said Sarah Grotta, director of debit and alternative products at Mercator Advisory Group. The foreign ATM fee comes into play when, for example, I use a Wells Fargo ATM to take cash out of my Bank of America checking account.

In that scenario, Wells Fargo is saying, “Hey, I'm letting your customer use my ATM, and I’ve gotta do all this activity to make sure that they've got funds in their account, and there’s all this connectivity that goes between different operators behind the scenes,” according to Grotta. Bank of America, in turn, passes that cost along to me.

Renard said foreign, or out-of-network, ATM fees often range between $2.50 and $3. So between that and the surcharge, I may have to pay as much as $6 just to get my hands on cash that belongs to me. 

Meanwhile, the banks are raking it in. In 2017, JPMorgan Chase, Bank of America and Wells Fargo reportedly collected about $6.4 billion in ATM and overdraft fees.

Frustrating? Yes. Avoidable? Also yes, according to Vadim Verdyan, head of advice at Albert.

It’s not necessarily bad to pay ATM fees as often as I do, but it’s a waste of money. If it costs me $6 every time I get cash, and I do it once a month, that’s over $70 a year.

“Those little charges can add up really quickly,” Verdyan adds. “These funds could be invested or saved.”

As such, Verdyan said I should do my best to avoid ATM fees. One way to do this is to plan ahead — perhaps by always keeping $50 or so in my wallet that’s earmarked for cash-only situations. 

Another is to go a little bit out of my way to find an in-network ATM or surcharge-free ATM. I should specifically check to see if my financial institution has partnered with Allpoint, which has 55,000 surcharge-free machines in Target, CVS and Walgreens stores, or CO-OP, which has 30,000 in 7-Eleven, Costco and Dunkin locations. Some banks, like PNC, also reimburse ATM fees for certain customers.

Finally, Grotta said I may want to take advantage of chances to get cash back at a store. If I use my debit card to purchase a candy bar or something else small, I can usually avoid fees and request to get cash back. If I’m smart, I could even save money while satisfying my sweet tooth.
(but please don't tell me you scrolled past all of my hard work)
ATM fees come from two different places and are totally avoidable if I just plan ahead. If I want to direct my fee fury somewhere, I should target banks — not so much the small business owners who have independent ATMs.

“It’s good to have cash conveniently available when you need it,” Renard said. “It’s unfortunate that we’re having these extra added charges.”
Wayne's World

check out this wild celebrity purchase
Gordon Ramsay
Chef Gordon Ramsay — who, humble brag, follows me on Twitter — recently dropped $55,000 on a sculpture of a stainless steel gorilla to go in one of his restaurants. The artist said Ramsay was drawn to the piece because it’s a “fellow alpha male.” Look, I don’t want to seem like an idiot sandwich, but in my opinion paying $55K for a gorilla statue is bananas. 

five things I'm loving online right now
1 "These boys found turtles squashed on the road. Now they spend their days helping other turtles get across." No, you're crying.
2 Free and haunted: my two favorite words.
3 Check out /r/weirdspotifyplaylists, an amazing subreddit that — you guessed it — collects Weird Spotify Playlists. Think: “i can’t pick a font for my essay,” “Owen Wilson walking through an art museum” and simply “Burrito.”
4 The National Zoo has a trio of two-month-old baby ferrets, and it’s set up a live stream of their den here. Thought to be extinct until the ‘80s, black-footed ferrets are endangered. More importantly, the kits are also hella cute. 
5 Money’s latest cover story dives into the weird world of Gen Z finance, and I’m obsessed. To echo Stefon from Saturday Night Live, this feature’s got everything: CBD, crypto, dorm rooms, TikTok, chocolate hummus, Elon Musk, YouTube ads, Beyond Meat, eye-popping figures… 

send me cute pictures of your pets, please
Meet Smudge, a feline who would NEVER pay ATM fees to get out catsh. Smudge is better than paying purrrcharges.

Gonna go order pizza.

See you next week.
P.S. Do you have a sneaky way to avoid ATM fees? Have you ever rescued a turtle? How much would you pay for a steel gorilla? Send me Dolla Scholla hollas at and/or @SuperJulia on Twitter.
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