Rearranging Consumer's Accounts

Banking off Overdraft Fees

Protect Your Account From Overdraft Fees

So you wake up one morning to check your bank account only to find that you have been slammed with several overdraft fees. How can this be? Well, as humans, we are guaranteed to make mistakes. Some have made the mistake of spending more than they have in their bank accounts. If your bank is known for re-ordering or rearranging transactions that is, taking the larger transaction’s first and then smaller ones, this could result in more overdraft fees for you. This is because some Bank’s charge an overdraft fee per transaction. Overdraft fees can be anywhere from $25-$35. If you are tackled with more than one fee, that $35 will quickly add up, requiring you to pay money that you may not have.

How can consumers protect themselves from such corrupt practices?

Check Your Bank’s Policy

Consumers can call their bank and ask what their policy is on overdraft fees. A few questions you can ask:

  • What is your policy concerning overdraft fees?
  • Does your company re-order transactions, taking larger transactions first then smaller ones?
  • What is your policy concerning overdraft protection? Can you opt out?

Find a New Bank

If you find that your bank re-orders transactions or don’t meet your standards as a good bank, you can move to another bank that does. Perhaps a smaller bank would be a better choice.

Monitor Your Account

If you don’t have the option or do not want to move your bank account elsewhere you can carefully monitor it each week or each time you make a purchase. Keeping a close eye on your transactions, making sure they have properly cleared, will help you avoid overdraft fees. It will also help you catch any other unusual behavior with your account. 

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Withdraw Your Money

If you can help but use the bank only for your direct deposit, then only use it for that purpose (if your account allows you to). Withdrawing your money once it’s deposited into your account leaves you know way of incurring an overdraft fee. If you pay bills with your account, just simply leave enough in the account to pay your bills.  You can always leave a little extra to be on the safe side.

Overdraft fees can be avoided with a little more planning and precaution on our part. As a consumer, be consistent with monitoring your account and if something is not right be sure to question your bank’s action and policies. 

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