Since ATM machines were introduced to consumers around 1960s, you could find one practically everywhere. In every corner in every block, inside malls, grocery stores, airport, hospitals, train stations, you name it. Indeed, with the convenience these ATM machines offer, fewer people go to the bank just to get cash. Instead, they brandish their bankcards, punch a few buttons and wait as crisp green bills come out from the dispenser. Since almost anywhere you go, there’s an ATM offering easy access to your money, you don’t really bother about finding the ATM machine of your own bank.

Great as it may sound, but do you know that there are hidden costs to using an ATM? Some of these charges you probably already know about, but some, too, you may not be aware. The average ATM fee as of last year (2009) was $2.22 per transaction. Many of the fees that goes to the owners of the ATM are often called surcharge fees that may reach as high as $4.00 per transaction. But the charges do not end there. When your bank finds out that you’ve made a withdrawal from an ATM it doesn’t own, it can charge you a “foreign” ATM surcharge. This fee reportedly cost around $1.32 to $4 in 2009. And while the ATM must, by law, inform you of the withdrawal fee, you’ll only learn about the foreign ATM fee when you open at your monthly statement.

These fees can add up. Let’s say you make one cash transaction a week at an ATM not owned by your bank, paying a $2 ATM fee to the bank that owns the ATM and a $1 foreign ATM fee to your own bank. $3 may not seem like a lot of money, but if you compare it to the amount you withdraw it could be a high percentage. For example, if you withdraw only $20, a $3 surcharge amounts to a 15% fee. Routine withdrawals of small dollar amounts can quickly add up to hundreds of dollars a year. From fees alone, you are paying financial institutions around $150 to even twice than that per year. That’s definitely not just a few bucks anymore.

Now for credit cards the story is similar. Different issuers charge different fees on overseas purchases made with your credit card. But the fees on credit card purchases are lumped in with the purchase price so it’s more difficult to determine exactly what they are.

If you come to analyze it, you are like paying them to use your own money. In fact, banks make billions of dollars a year charging people to access their own money, and ATM fees are even steadily rising. But yet, with a little foresight and planning, you can actually avoid paying ATM fees altogether.

Let me tell you how:

Open Accounts at Banks with Convenient ATM Machine Access

One of the easiest ways to avoid ATM fees is by doing something, well, obvious — use only ATMs that don’t charge a fee. It costs nothing to access your own bank’s ATMs, so you’ll save money if they are located in convenient areas. Before you open a new checking account, make sure there are ATMs near your home, work and other frequented locations. Typically, the bank where you have your checking account will let you use its ATMs free of charge. If you choose a large national bank with a sizable presence in your area, you won’t have to go out of your way to find a free ATM.

If in case you choose to retain your old bank, make sure you only withdraw from an ATM machine owned by your bank. You can check a bank’s Web site or ask a bank manager to find out which banks charge ATM fees and which don’t. Once you’ve established that your bank doesn’t charge a fee, log on to its Web site and use the “branch locator” to find out where its ATMs are located. Nowadays, mobile apps can help you locate ATMs that won’t charge you fees.

Choose Banks That Waive ATM Fees

In today’s banking world, banks that don’t ever charge ATM fees are rare. Fortunately, there are still banks that will not charge you an ATM fee for using out-of-network ATM. USAA is one bank that will not only don’t charge ATM fees when you use another bank’s ATM, they also reimburse you the fees the other bank charges you to make the transaction (up to 10 withdrawals per month, and $15 from other banks). Some online banks also offer ATM reimbursement, but they often have a low maximum reimbursement amount. See if your bank is part of a no-fee ATM network. If it is a member of one of these networks, go to the network Web site and find out where the machines are located. Two such no-fee networks are AllPoint and Moneypass. Both have thousands of ATMs across the United States. The network Web sites will tell you where they are.

Plan Your ATM Withdrawals

Plan your cash withdrawals when you can access your own bank’s ATMs. Taking out small dollar amounts isn’t worth paying the ATM fee. If you have to use an ATM not owned by your bank, plan ahead for how much money you need, and take it all out at one time. By doing that, you minimize the percentage of the transaction you pay in fees. At an average of about $3 per transaction, pulling out $20 several times a week – - – that equals to 15% of your every withdrawal, remember. By withdrawing $100 once a week instead of spread out over 5 transactions, you would have saved more than $10 per week.

Get Cash Back

When shopping at the grocery store or drugstore, use your ATM card to get cash back when you purchase something at a point-of-sale cash register. Personally, I use credit cards for almost every purchase I make. You don’t pay any fees for getting cash back. What’s more, using your card makes tracking expenditures easy with software such as Quicken, and for other benefits of using credit card, like free extended warranties and fraud protection. In addition to using credit cards, you can pay with a check or your debit card instead of using cash.

Checks are starting to seem old fashioned. Many people only use them for payments that can’t be done electronically. But some stores still accept checks, so keeping a checkbook with you could get you out of a jam when you run out of cash. Of course, the store may require that you carry its check-cashing card before it will accept your check, but these cards are usually free and many stores allow you to make your first check purchase immediately after filling out the application. Even better, the store may give you cash back if you write the check for a larger amount than the purchase (but ask first to make certain this is the store policy).

More ATM Fee Saving Ideas

-When traveling, use traveler’s checks, personal checks, or credit cards.

-Avoid ATMs in convenience stores, hotels, casinos, restaurants, and similar locations. They tend to charge higher fees.

-Keep a healthy amount of cash on hand. OK, there are reasons why you might not want to keep a lot of cash in your purse or wallet — it might get stolen and it won’t be earning any interest from your pocket. But consider the advantages. If you need cash in an emergency, you’ll have it. Carrying money is especially useful if you’re going to be out of town, where your bank might not have any branches, or if you’re going to be at a festival or sporting event for several hours where the selection of ATMs might be limited or charge a hefty fee.

Indeed, $3 or $4 in fees isn’t a lot, but it can add up quickly. If you put in the little extra common sense and effort to save on ATM fees, you’ll save enough money that, by the end of the year, you can afford to give yourself a nice holiday present, or better yet, keep it in the bank for rainy days.