| The rancor surrounding overdraft fees is growing. The | | | | them to make purchases they can't afford. After all, a |
| media is filled with horror stories and public message | | | | declined card is usually better than paying an extra |
| of disgust. Now congress is even proposing the | | | | $30. |
| creation of an entirely new federal agency that could | | | | However, this is not a good idea for heavy check |
| limit banks' practices in this area. But what options exist | | | | writers who will incur both an overdraft fee from the |
| now for hurting customers? The answer: plenty. | | | | bank and a bounced check fee from the merchant if |
| Here are five basic alternatives to paying large and | | | | they are no longer enrolled in an overdraft protection |
| unreasonable bank fees. | | | | program. |
| 1. Use your PIN number | | | | 3. Overdraft line of credit |
| It is not uncommon for people to check their account | | | | Some banks will treat your overdrafted amount as |
| balances, spend money that they can see that they | | | | though you bought something with a credit card. You |
| have in their account, and then be charged an | | | | will pay interest on the money you've overdrafted at a |
| overdraft fee. Many times, this is not due to a bank | | | | reasonable rate similar to most other credit cards, and |
| error, but by selecting "credit" instead of "debit" when | | | | you can only borrow up to a credit limit. |
| making a purchase. | | | | 4. Funds Manager |
| By running a card through the credit card system, no | | | | Funds manager is a service that is just now being |
| money if taken from the account until a few days | | | | offered by a bank in Michigan. For a small monthly fee, |
| later. In the meantime, some vendors put a hold on | | | | a customer can have the ability to "peek" at the items |
| much more money than they actually end up charging | | | | that the bank will file for the day. If they realize that |
| you. Although money with a hold on it shows up in | | | | they will overdraft their account, they can visit the bank |
| your account balance, you cannot actually spend it and | | | | before the items actually get posted to make a |
| will be charged an overdraft fee. By using your PIN | | | | deposit or a transfer. |
| number instead, you can almost always pay the | | | | 5. No overdraft checking account |
| vendor immediately and don't have to worry about | | | | There are now online checking accounts that charge |
| large holds or the confusion of pending transactions. | | | | no overdraft fees at all. This not only includes the fees |
| 2. Opt Out | | | | caused by overdraft protection programs that plague |
| Most banks will allow you to opt out of your overdraft | | | | debit card users, but also the regular check bouncing |
| protection program. This program is what allows you | | | | overdraft fees that are a problem for check users. |
| to spend more than is in your account in the first place. | | | | These accounts cost a monthly fee, but for many |
| Opting out of overdraft protection can save heavy | | | | debit card users, the cost is much much less than they |
| debit card users a lot of money in fees by not allowing | | | | are paying in overdraft fees each month. |