We\u2019re living in an era of the rapid adoption of technology in financial services.\u00a0 In 2010, 80% of American households perform their banking online.\u00a0 30% bank on their mobile devices \u2013 leaping up 23% from the year before. \u00a0\u00a0\r\n\r\nAnd yet, in a world where digital finance is fast becoming the norm, there is one holdout: cash.\u00a0 In America, a staggering 27% of transactions are still cash.\r\n\r\nAnd what does that mean for American consumers?\u00a0 For one, it means ATM Fees \u2013 which in recent years, have been on the rise.\u00a0 From 2007 to 2012, ATM surcharges rose by $0.35, on average to $2.10.\r\n\r\nWhile ATMs are a valuable service offered by banks \u2013 and increase in fees has tracked an increase in cost for operating ATMs \u2013 we still take issue with the increase.\u00a0 First, they\u2019re not always straightforward.\u00a0 And second, they\u2019re effectively tax on to your capital.\r\n\r\nSo in this post, we decided to share some\u00a0ways you can use technology to avoid ATM fees. \u00a0But first, we review how ATM fees actually work.\r\n\r\nThe Mystery Fee\r\n\r\nThere are two types of ATM fees: the Surcharge Fee and the Foreign Fee.\u00a0 Both of these fees arise whenever you use an ATM out your bank\u2019s network.\r\n\r\nMost of us are likely to be familiar with the Surcharge Fee.\u00a0 It\u2019s the fee that the out-of-network ATM charges you to access cash at that location.\u00a0 Many of us have can recall a time \u2013 happening upon a farmer\u2019s market, or upon discovering a new restaurant is cash-only \u2013 where we\u2019ve had to run to another bank or duck into a bodega to grab cash.\u00a0 At the bank, we\u2019re prompted to approve a transaction by first agreeing to the surcharge \u2013 which can range from $0.35 to $5.00.\u00a0 According to a GAO study, the average surcharge is $2.10 (although this may vary: if you live in a large city, the suburbs or in the south, the report found you\u2019ll tend to pay more).\r\n\r\nThe second type of ATM fee \u2013 the Foreign Fee \u2013 is a bit more clandestine than the first, since it doesn\u2019t appear until you\u2019re reviewing your bank statement. The Foreign Fee, is your bank\u2019s way of punishing you for accessing cash from an ATM machine outside of its network, to put it bluntly.\u00a0 So, in addition to the $2.10 you pay the ATM holder, you can also expect to pay your bank an additional fee, which in 2012 averaged $1.52 amongst traditional banks and $1.29 amongst credit unions. \u00a0While an out-of-network ATM may disclose that additional fees may apply, we\u2019ve talked to Personal Capital users who said it was not until they began tracking their checking account together with their credit cards that they became aware of the Foreign Fee.\r\n\r\nA Tax on Your Capital\r\n\r\nIf you add up the average Surcharge Fee and Foreign Fee, the average ATM fee is over $3.50 per transaction.\u00a0 While $3.50 may not seem like much, if you\u2019re withdrawing $100, that\u2019s like a 3.5% tax on your capital.\r\n\r\nThankfully, over 85% of cash withdrawals are from in-network ATMs.\u00a0 But for the rest, it seems like the tax on hard-earned capital is steep. Making money is hard enough.\u00a0 Accessing your own money should be simple \u2013 and tax-free.\r\n\r\nStemming the Tide, and Taking Action\r\n\r\nFortunately, banks have not gone completely untended.\u00a0 In 2011, JP Morgan Chase tested out a $5 ATM fee (up from $3); public reaction caused this unpopular experiment to be brief.\r\n\r\nAnd for individuals, advances in technology have helped to give us new ways avoid ATM fees beyond just being prepared with a level of cash reserves in your wallet.\r\n\r\n1.\u00a0 Your Phone.\r\n\r\nThese days, some banks have mobile apps with branch locators.\u00a0 You might even want to bookmark the page on your smartphone from your bank\u2019s website so you can easily access.\u00a0 Don\u2019t miss out on going to branch if it\u2019s nearby.\r\n\r\n2.\u00a0 Your Merchant\u2019s Phone.\r\n\r\nIf your favorite vendor only deals in cash, it won't hurt to try convincing them to begin using one of the many credit card readers that enable vendors to accept payments via their phones.\u00a0 (NB: There\u2019s typically a fee associated with those transaction that the vendor may end up passing along to the consumer).\r\n\r\n3. Online Banks\r\n\r\nAs a means to acquire customers \u2013 and make up for their lack of brick & mortar presence \u2013 many online banks offer ATM-fee reimbursement.\u00a0 With no brick-and-mortar stores to operate, these types of banks have fewer operational costs and are able to pass on these savings to customers.\u00a0 Particularly if you can find a high-yield checking account, it might be worth opening up a second bank account for your cash needs.\u00a0 But make sure you weigh any other costs associated with opening and maintaining those accounts, and continue to read the fine print.