Overcoming Overdraft Fees

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Apr 14, 2017


Overcoming Overdraft Fees

If you’ve ever dealt with a returned check or had a debit card unexpectedly declined, you know it doesn’t take much more than a few math errors to end up in an awkward situation. Maybe your paycheck hasn’t hit your account yet, or your spouse got a tank of gas on the way to work and forgot to tell you.

Often, overdrafts are caused by simple bookkeeping mistakes. Despite your best efforts to keep an accurate account balance, accidents can and will happen. Still, overdrafts are better than the embarrassment and possible legal consequences of having your debit card declined at a restaurant or coffee shop.

It’s important to note that overdraft protection is not a loan, and you shouldn’t think of it as a line of credit. It’s protection against unexpectedly not having enough money in your account. You should not treat it like a credit limit on your debit card or rely on it to buy necessities. There is still a fee per transaction, and you are expected to pay back the amount of your overdraft within a short period of time.



  • Link your checking account and savings accounts.


  • Set up a realistic budget. Have an honest conversation with your family about how much you can afford to spend each month, and then stick to it.


  • Keep track! Taking note of your balance daily will help you keep a mental tally of your account, which might keep you from over drafting.


  • Start creating an emergency fund. Putting aside even a few hundred dollars to deal with surprise car repairs or unexpected bills can help keep you out of financial trouble.


  • Make manual online bill payments instead of automatic ones. One of the most common causes of overdraft fees is an automatic withdrawal that comes a day early or is forgotten about.