| I opened my first checking account on my 18th | | | | up to $1000. However, instead of being charged an |
| birthday. During the account opening process, I was | | | | overdraft fee for each transaction, you're just charged |
| repeatedly told that if I ever let my checking account | | | | interest on the negative balance until you're add money |
| balance become negative, then I would be hit with an | | | | to your checking account to make have a positive |
| "overdraft fee" of $32.00, which the bank discreetly | | | | balance. An overdraft line of credit is good to have, but |
| called "Overdraft Protection". I thought to myself, "Well | | | | isn't an excuse to keep putting your checking account |
| I'm not going to let that happen!". A year later, I had paid | | | | in the red. |
| more than $800.00 in fees. Go figure. | | | | Watch Your Account Balance Like a Hawk |
| Overdraft fees are huge money makers for banks. | | | | If your bank offers online banking, sign up for it so you |
| For the year 2009 alone, banks are expected to take | | | | can view your checking account balance through out |
| in more than $25 billion dollars just from overdraft fees | | | | the day, and only spend what's available in your |
| alone. Some banks make more money in overdraft | | | | account. If you spend more than you have, then you'll |
| fees than they do giving out loans. So how much of | | | | be charged an overdraft fee. Just be careful though |
| that $25 billion is yours? I can tell you that none of it is | | | | because if you use your bank card as credit a few |
| mine because I haven't had to pay an overdraft fee | | | | times and forget about it, those transactions can take |
| once I discovered some secrets to avoiding them. | | | | a few days to post to your account, which could put |
| Here's how you can avoid overdraft fee's too. | | | | your checking account in the red. |
| Only use Debit, not Credit | | | | I've also found that when it comes to overdraft fees, |
| More than likely, you got a card with a visa or | | | | banks like to be sneaky so that they can make more |
| MasterCard logo on it when you opened your | | | | money. For example, say you made six purchases |
| checking account. This card can be used as either | | | | with your checking account bank card one day and |
| debit or credit. With debit, a cashier will ask you to | | | | instead of using debit you used credit. The first five |
| enter your pin number after he or she has swiped | | | | purchases you made throughout the day were little, |
| your card. With credit, the cashier will ask you to sign a | | | | under $5.00 each. At the end of the day you made a |
| receipt (or just hand you a receipt if the transaction is | | | | large purchase of $250.00, which you didn't realize |
| less than $25.00, depends on the business). The main | | | | would make your checking account balance negative. |
| difference between the two though is that with debit, if | | | | Well the next day, the bank will post the larger |
| you don't have enough money in your checking | | | | transaction first, and then post the five remaining |
| account to cover the sale, your card will be declined. | | | | transactions to get a total of six overdraft fees from |
| With credit, your card will be approved even if you | | | | you. Had the bank posted the larger transaction last, |
| don't have enough money, and then you'll be charged | | | | you'd only have to pay one. |
| an overdraft fee. So only use debit whenever possible. | | | | So to avoid paying those horrible overdraft fees, use |
| Ask About an Overdraft Line of Credit | | | | debit only whenever possible, ask your bank about an |
| Most banks offer an overdraft line of credit, but they | | | | overdraft line of credit, and check your checking |
| don't advertise it because they want you to pay | | | | account balance frequently to make sure you have |
| overdraft fees. An overdraft line of credit allows your | | | | enough money to cover your daily purchases. |
| checking account to have a negative balance, usually | | | | |