Overdraft charges are one of the most annoying and frustrating charges banks do to their customers. While some people abuse their checking accounts, most people never intend to overdraft. And when they do, sometimes it’s only by about .50 or .60 cents. And then that .50 or .60 cents ends up costing you $30 or $40. This is completely unfair, so it’s important to protect yourself from your bank. Here are a couple of ways for you to protect yourself from overdraft charges.
Get Overdraft Protection
It’s not a perfect solution, but it will certainly help. With this protection, if you overdraft your account, the money comes from another account or your credit card to cover the transaction. My bank charges $10 for this every time you overdraft, so you don’t want to rely on it. But at least it’ll be a smaller charge if you accidentally overdraft.
This is a habit I always try to use. When you make a transaction, round up. Assume you spent more than you did, this way you’ll have extra in your account. This is a good way to save money as well, so I think it’s a good habit to get into.
Give It a Few Days
The only time I’ve overdrafted is when I thought a check to me or a paycheck cleared and it hadn’t quite yet. So it’s always a good idea to give it more time than you think it needs, just to make sure the check clears. Most banks take a couple days to cash a check, and if you do it through an ATM, it can take even longer. So make sure you give it some time, and if you have online banking, make sure the check is in your account before spending any money.
Get Online Banking
That being said, you should get online banking if you can. Most banks have it as a free feature, so it’s a good thing to have. You can instantly see how much money you have in your account, preventing you from overcharging your account. You can also see pending payments, giving you an even more accurate view.
Dispute the Charge
If you do accidentally overdraft, and you think it’s something that’s not your fault, don’t be afraid to dispute the charge. For instance, my bank once put my paycheck into the wrong account, and so I had an overdraft. Needless to say, I disputed the charge, and got the bank to refund the $40 overdraft fee. It takes a little perseverance, but you can do it if you are in the right.