At a time when big banks are constantly raising fees or imposing new ones to help them recover revenue lost to new regulations, not-for-profit credit unions are booming.
Nearly any way you slice it, checking accounts became more expensive in the first half of 2012.
The average minimum checking-account balance needed to avoid a monthly service fee jumped by more than $850, to $4,446.57, according to MoneyRates.com's semi-annual bank fees survey. Overdraft fees rose for the second straight quarter to an average of $29.83, up from $29.23.
Among banks that charge a monthly fee, the average cost was $12.08, up from $11.28. ATM fees also increased, both for bank customers using out-of-network machines and for non-customers using a bank's ATM.
"This is the most comprehensive rising fee trend we've seen in one of our checking account surveys," Richard Barrington, MoneyRates.com senior financial analyst, said in a statement.
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Consumers are most likely to find lower fees by choosing smaller banks and credit unions.
Thirty-six of the nation's 50 largest credit unions, or 72 percent, offer free checking accounts without a minimum balance requirement, according to Bankrate.com's annual 2012 Credit Union Checking Survey.
An additional 10 percent of these credit unions will waive monthly fees if account-holders maintain a minimum balance ranging from $100 to $750.
That compares with only 45 percent of banks offering free checking without minimum balance requirements, according to Bankrate.com's latest survey. Banks' minimum balance requirements also tend to be much higher -- $585 for noninterest-bearing accounts and a staggering $5,587 for interest checking accounts.
"Overall, 98 percent of the credit union checking accounts that we surveyed are either free or can become free if the account-holder meets minimum balance, direct deposit and/or e-statement requirements," said Greg McBride, Bankrate.com's senior financial analyst.
As a result, membership in credit unions rose by 667,000 in the first quarter to a record 92.5 million, according to the latest figures from the National Credit Union Administration. That quarterly gain in membership is 62 percent higher than the increase of 412,193 members in the previous quarter.
In addition to record membership, credit unions' assets and net worth also hit record highs. Total assets, which include cash and deposits, grew by $40 billion, or 4 percent, to top $1 trillion for the first time, while industry net worth, which is the credit unions' total retained earnings, increased by 2 percent to $100 billion.
However, it is worth noting that even at credit unions, overdrafts will cost you. The average cost of the first overdraft is $26.65, up from $26.05 last year, compared to $30.83 at banks. The most common fees assessed are $25 and $30, compared to the most common fee of $35 at banks.
Ninety-six percent of credit unions surveyed will charge a non-member for using their ATM. The average ATM surcharge is $2.08, almost identical to $2.10 last year, compared with $2.40 at bank-owned ATMs. The most common surcharge is $2, compared to $3 at banks.
Compare checking account yields, monthly service fees, penalties for non-sufficient funds and the minimum to open an account to earn interest for those credit unions in the Bankrate.com survey. To see the details of each institution's checking account, click on the name of the credit union.
Also, check out the infographic below for more on the strengths and weaknesses of credit unions and big banks.
Created by IBM Southeast Employees' Federal Credit Union.