Published in the Pawtucket Times on January 7, 2002

For most retirees living on a fixed income, putting the brakes on rising out-of-pocket costs can provide the income to purchase needed prescription drugs pay for rent or even buy food.

A new AARP report provides just the right ammunition to seniors to ditch their high bank fees for low-fee checking accounts.

According to the Federal Reserve Bank, checking account fees pull in about $ 55 billion for the banking industry. That’s quite a hefty profit.

Average fees charged for cashing a check can range from 2 percent to 3 percent of the face value amount of a check. For low-to-moderate-income seniors, the checking account fees can quickly add up.

According to AARP Rhode Island State Director Kathleen S. Connell, writing checks to pay bill has become a necessity of life.

“Low-and moderate-income consumers should be informed about basic banking services available to avoid paying high fees to cash checks and get money orders,” she said.

AARP’s new educational initiative, “Score a Home Run and Win with Lower Bank Fees,” is geared to assisting older consumers in identifying banks that provide free or low-cost checking accounts, states Connell.

As part of this initiative, the senior advocacy group is offering a new bank survey fact sheet called “Choosing a Checking Account” that makes it very easy to compare banking information, she says.

The AARP fact sheet identifies financial institutions offering free, senior discount, regular and interest-yielding accounts, as well as a new type of account called an “Electronic Transfer Account” (ETA). The five financial institutions surveyed include BankRi, Citizens Bank, First Bank and Trust, Fleet Bank and RI State Employees Credit Union.

Some seniors may find shopping for a checking account as confusing as walking through a tangled maze. Some banks and credit unions offer free checking to persons of any age. But other financial institutions will provide free checking only when you use direct deposit, such as having your payroll check, Social Security or other benefit check directory deposited into your account.

Many local banks offer special free or low-cost checking “senior discount accounts.” Since not all banks advertise their discounts, AARP recommends that seniors should ask their banks whether such accounts are available.

Additionally, the newly available AARP fact sheet tells seniors they can avoid costly check cashing fees by taking advantage of an ETA. This low-fee account allows a person to get their federal government checks, like Social Security, by direct deposit for a monthly fee of $ 3 or less. An ETA, unlike most checking accounts, does not have a check-writing feature.

“I recognize that independence is one of seniors most treasured assets,” Rhode Island General Treasurer Paul J. Tavares told All About Seniors,” noting that his office works closely with AARP to sponsor seminars for seniors called “Saving and Investing Over 55.” The AARP fact sheet will be distributed at these seminars.

“I have always encouraged AARP to better educate their membership on good savings practices. Initiatives like this help educate Rhode Island consumers, and the more knowledgeable shopper become the better consumer,” Tavares said.

Take control of your finances by exploring your checking account options. Free copies of AARP’s “Choosing a Checking Account in Providence,” Stock Number D17496 can be obtained by calling 1-800-424-3410 or writing AARP Fulfillment 601 E Street, NW, Washington, D.C. 20049. “La Busqueda del Tesoro” or “The Treasurer Hunt” from AARP, Fulfillment Stock Number D17465. The historieta is targeted to Hispanic consumers who do not have checking accounts.