Beware Venmo Convenience Fees: They Can Total $91 or More Annually When You Add Them Up
If you use Venmo often, paying $1.75 to move $100 to your bank account instantly might not seem like a big deal. Do it once a week for a year, though, and you’ll spend a total of $91 just to get your money faster.
For a $100 Instant Transfer, Venmo’s 1.75% fee comes to $1.75. Depending on how much you transfer, the fee can range from 25 cents to $25.
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If you don’t need the money right away, you can choose to transfer it from Venmo to your bank account within one to three business days for free. But if you do want it now, you'll have to pay for the convenience.
A Small Fee Can Turn Into an Expensive Habit
Spending $1.75 one time isn’t going to do much damage to your budget. You may not even think twice about it when the other option means waiting a few days for your money.
But suppose you regularly receive money through Venmo. Maybe you split bills with someone or get reimbursed for purchases. If $100 lands in your account each week and you always move it instantly, you’re giving up $1.75 of it every time.
Four transfers cost $7 in convenience fees, while 10 transfers cost $17.50. And by the end of 52 weeks, those small charges total $91.
Bigger Transfers Mean Bigger Fees
The $1.75 fee applies when you move $100. If you transfer a higher amount, you’ll pay more in fees.
For example, instantly transferring $200 costs $3.50 at Venmo’s 1.75% rate. Do that every week, and you’ll pay $182 over a year. At $500 per transfer, the fee is $8.75. That comes to $455 over 52 weeks.
Venmo caps its instant-transfer fee at $25, but you don't have to come close to that cap to spend hundreds of dollars a year.
What Does the Fee Buy You?
The fee is the price you pay to get your money instantly. Venmo said an Instant Transfer usually reaches your bank or eligible debit card within 30 minutes.
Sometimes that may be exactly what you need. However, if you don’t need the money for a few days, there’s the free option.
Venmo's standard transfer takes one to three business days and costs $0.
If you used Instant Transfer only half as often and waited for the free transfer the other 26 weeks, on $100 weekly transfers, your yearly fees would drop from $91 to $45.50.
How Much Is Convenience Costing You?
At $100 a week, you're paying $91 a year. At $200, the yearly total is $182. At $500 each week, it's $455.
That doesn't mean paying $1.75 for an Instant Transfer is always a bad deal. If you need $100 in your bank account now to avoid a $35 overdraft fee, it’s likely worth it.
But if you automatically tap “Instant Transfer” every time money hits your Venmo account, you could be paying for a convenience that can really add up.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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