8 Ways to Avoid Bank Fees

6. Move to a credit union (or just threaten to). On Sept. 29, Bank of America and other banks announced plans to impose a $5-per-month fee for the privilege of using their debit cards. Over the next month, close to 700,000 people opened accounts at lower-fee credit unions, taking $4.5 billion in deposits with them. On Nov. 1, in the face of a public relations disaster, the $5 fee was dropped.

A recent report by consulting firm cg42 predicts that the nation's top 10 banks could lose $185 billion in deposits because of customer frustration in the coming year.

So if you're considering a move — or even if you're not — this might be the time to politely remind your big bank that it isn't the only game in town. New customers take note: Some banks now levy fees for closing accounts opened within the previous 90 or 180 days.

7. Go online. Online banks such as Ally, ING Direct and EverBank have lower overhead than brick-and-mortar banks, which can mean lower fees. Banking online with your current institution also may help you avoid increasingly common charges for paper statements.

8. Think small. While the big banks need to satisfy profit-seeking shareholders, smaller community banksfocus more on their bread and butter: keeping customers happy.

"It was community banks that offered free checking before it became fashionable," says McBride. "Many have been run by the same family for generations, and they built their identity by serving customers without nickel-and-diming them with fees." You can find community banksat this website run by the Independent Community Bankers of America, a trade association.

Sid Kirchheimer writes on consumer affairs for the AARP Bulletin.

Also of interest: Credit unions: Pros and cons. >>