Elizabeth Scott wanted to teach her kids a lesson about money a few years ago, so she opened Bank of America savings accounts for them. But Bank of America taught her a lesson that she never expected.
Now she wants to know if our advocacy team can help undo an unwanted tutorial in bank fees.
What happened? Back in 2019, she set up two bank accounts for her kids. A Bank of America representative agreed to waive the bank’s $8-per-month maintenance fee. But that didn’t happen, and within a few months, the kids’ money was gone.
Scott’s case is a reminder of the danger of bank fees. It’s also a case study in personal responsibility — specifically, reading the fine print and getting any agreement with a bank (or any company) in writing.
But is it too late for Scott to recover the $300 in surprise fees?
How Bank of America fees took her kids’ money
In late 2019, Scott opened savings accounts for her two children at Bank of America. They were 6 and 9, which is a great age to teach your kids about the value of money and the importance of banking.
“I have held an account with Bank of America for over 20 years,” she says. “So I was able to set them up online quickly.”
Scott deposited $150 in each child’s account.
But then she noticed a problem.
“Since the balance was so low on each child’s account, I noticed that they would be charged $8 a month as a maintenance fee.”
Scott wanted to follow through with the lesson, but she knew that if Bank of America withdrew $16 a month from her kids’ accounts, it would be a short lesson in bank fees.
So she phoned Bank of America’s customer service department. A representative told her Bank of America might waive the fees. But it was up to the branch manager.
“At the local branch, a representative told me I needed my two children present,” she recalls. “So I went back to the branch with my two children, at which time they signed their names to ensure they would not incur fees since they were minors.”
And that was it.
“After that day in late 2019, we essentially employed the ‘set and forget’ approach,” she says.
Little did she know she was about to learn her own lesson in banking fees.
Each child has $0 in their account. How did that happen?
Fast forward to March 2022, when Scott received two letters from Bank of America with some unfortunate news.
The $150 she deposited in the kids’ account was no more.
“Each child now had $0 because $8 had been drawn out monthly since 2019,” she says. “Behold, my children’s entrée into the American financial system!”
So how did that happen?
She had trusted the branch manager to do what he agreed to, but he didn’t.
“And then there was a big global pandemic, and the kids’ banking was the furthest thing from our minds,” she says.
That’s right, she didn’t check their accounts to ensure the Bank of America fees weren’t being charged. “Set and forget” didn’t work out so well.
“I called customer service to resolve this error. A representative directed me to my local branch, where I explained the situation to the banker. But the local branch could not help me,” she says.
Scott tried contacting Bank of America in writing. Here’s the terse reply she received:
Unfortunately, we’re unable to complete your request at this time. We’re unable to provide the requested service for this type of account. Thank you for banking with us.
What fees are charged at Bank of America?
Bank of America charges all kinds of fees. They range from a monthly maintenance fee on checking accounts to a stop payment fee.
Here’s are the types of fees you’re likely to encounter:
Check image service fee — $3
International transaction fee — 3 percent of dollar amount
IRA custodian transfer fee — $50
Non-Bank of America ATM fee — $5
Overdraft item fee — $35
Replacement debit card fee — $5
Statement copy fee — $5
You can see a full list of fees on the Bank of America site.
Why charge these fees? Because they’re a source of revenue for banks.
American banks generated an eye-popping $15.47 billion from overdraft and insufficient funds fees in 2019, according to the Consumer Financial Protection Bureau. The bureau says banks have become addicted to these fees and that they’re an important source of revenue.
Earlier this year, Bank of America eased up on some fees. The bank announced it would eliminate its insufficient funds fees and reduce overdraft fees from $35 to $10. That change took effect last month.
Unfortunately, these changes didn’t affect monthly maintenance fees. Nor were they retroactive.
How do you avoid monthly maintenance fees at Bank of America?
You can avoid Bank of America’s fees by carefully reviewing the terms and choosing the right account.
An Advantage SafeBalance account has a lower monthly fee ($4.95). To completely avoid the monthly maintenance fee, you must be a qualified student or be a minor. You can also meet the requirements by enrolling in a preferred rewards program and reaching an elite tier through a hotel chain like Hilton.
For a more full-featured Bank of America Advantage Plus account, you’ll pay $12 per month. But you can avoid that fee by making at least one qualifying direct deposit of $250 or more to your account or maintaining a minimum daily balance of $1,500 in your account. You can also become an elite-level traveler.
If you want to avoid the $25 monthly fee for a high-end Advantage Relationship banking account, you’ll have to keep a combined balance of $10,000 or more during each statement cycle. Or you could become an elite-level traveler.
If you have questions about avoiding Bank of America’s fees, you can always ask a banker. I also publish executive contacts for Bank of America on this site.
What to do if you find an unwanted Bank of America fee charged to your account
To avoid unwanted fees — and let’s be honest, are there any other kind? — you first have to know about them. To do that, go to your Bank of America mobile app and activate notifications.
Sign in and click on the “alerts” section on the main menu. Then select “set up alerts” at the bottom of the screen. Slide the Notifications button to “on” and wait for a confirmation message from the bank.
Do not set and forget!
Monitor your account like a hawk. By the way, unpleasant surprises like this can happen to anyone, including a seasoned consumer advocate. Remember my problems with BLD Resume a few years ago? I’m still embarrassed by that.
The moment you see a fee you don’t recognize, call your bank. Talk to a banker and, if necessary, your branch manager. Bankers can easily remove fees as a one-time courtesy. The real trick is to ensure the fee never returns. For that, you’re going to need to take names and business cards — and get something in writing.
This is why you should teach your kids about money
Before I get to the resolution of this case, I wanted to talk about Scott’s goal — to teach her kids about money.
In a society where advertising messages pound us 24/7, ordering us to spend, spend, spend, financial literacy is so important. Only 57 percent of American adults are financially literate, according to a study by the Milken Institute.
In other places, it’s part of the school curriculum. I still remember in first grade, when our public school near Vienna, Austria, required every child to bring 20 schillings (a little more than a dollar) to school to open a savings account at the Zentralsparkasse. (If they’d charged a maintenance fee, I think the parents would have rioted.)
Point is, you can’t start too soon. So I fully support Scott’s efforts to teach her kids how to handle money responsibly. If only someone at Bank of America would have seen what she was trying to do and helped her.
What went wrong with this Bank of America fee case?
If a Bank of America representative told Scott that her kids wouldn’t have to pay the $8 monthly fee, they shouldn’t have to pay it.
But what did the paper trail say?
Unfortunately, she didn’t keep a written agreement with the branch manager to waive the fees. And she didn’t have any written correspondence between her and Bank of America that would have substantiated her claim.
All she had was a detailed written account and an electronic chat session, which she initiated with the bank after contacting my advocacy team.
The bank had every right to charge her these fees. Bank of America discloses them when you open an account. Unless she had some proof that the bank agreed to waive the fees, she should have been prepared to pay them.
So my advice is:
- If a manager agrees to waive a fee, get it in writing. (Scott had the branch manager’s business card but nothing else in writing.)
- Monitor your account obsessively. Review every text message and if you see anything that looks unusual, take immediate action.
- When you try to resolve the problem, keep a meticulous paper trail. A quick chat transcript may not be enough. Send an email to a bank executive, if necessary. Document everything. You have to show that you’ve tried to fix this on your own.
Bank of America returns the fees
I contacted Bank of America on Scott’s behalf. A few days later, I heard back from her.
“Good news!” she said. “I heard from Bank of America yesterday and they asked me to come in, and they would help me reopen my children’s accounts. I made an appointment, went to the bank today, and set everything up. The operations manager for my area deposited $200 into each kid’s account. I could not be happier with this resolution. My absolute sincerest thanks!”
I’m so pleased Bank of America fixed its fees. But I think Scott got lucky. I imagine thousands of other customers also used “set and forget” on their accounts and are now penniless. Our small advocacy organization can’t help all of them, but this story can help you avoid a future problem with Bank of America fees.
Have you ever been surprised by a bank fee?
I’d love to hear your story about unwanted banking fees. How did you discover them? Did the bank reverse them or did you have to pay? What kind of advice would you have for someone like Scott, who lost all her money to bank fees? Please scroll down; the comments are open.
About the art
After reading the Consumer Financial Protection Bureau report on bank fees, artist Dustin Elliott imagined Bank of America as an enormous corporate vacuum cleaner. “The bank sucks dollar bills from your pocket one by one — often without you knowing it,” he says. Someone should really find the “off” switch for that appliance.