5 Sneaky Overdraft Traps

As we all know, banks have not been doing so well this year. More banks are continuing to lose money so they are trying to find other ways to make money from their customers, the ones that keep them alive. There is an article about five ways on how banks could make you pay additional fees on overdrafts. Good thing that they also include some solutions to make sure you don’t receive these additional sneaky charges.

Debit and ATM Cushions

Finance-questionSome bank’s debit cards will allow you to overdraw on your card on some accounts. You might think that by using your debit card to make purchases, you will never spend more than what you actually have but this theory might not be true. You might still be withdrawing more money than you actually have in your bank account.

What this article recommends is to contact your bank to ensure the overdraw account is set to zero so you never over spend. This is a safety net to keep you from spending more than what you actually have.

Reordered Debits and Deposits

Some banks might not count your deposits and your debits at the correct order you actually completed your transactions. This, in turn, could prevent you from knowing what is the exact amount you might have in the bank account at the time of your debit transaction. I always double check my online banking account to ensure the deposit I made has actually been cleared before making any kind of debit from it. Some online banking accounts actually take longer for the deposit or transfer to go through so I ensure that it actually is available before making any debits from it.

Extended Overdraft Fees

Some banks will charge you extra money if you do not pay back the overdraft fee that has been assessed to you. To prevent this from happening, I would recommend that you link up a savings account that will transfer money into your checking account if you are overdrawn.

High Daily Maximums

As the article states, only 30% of banks set a daily maximum for the number of overdraft transactions you can have. If you make a lot of transactions in one day using your debit card, you might want to contact your bank ahead of time to have them waive the fee. It can add up real quick if you don’t watch your transactions carefully.

Funds on Hold

Be careful about funds been put on hold. It may stay on your account for a day or even longer. If you only have a certain amount of money and it is put on hold, you can obtain a overdraft on your next charge.

If you are pretty good with your budget, you might consider using your credit card.