How to Avoid Overdraft Fees
It’s no secret that overdraft fees are a pain to deal with because they cost you your hard-earned money and often show up on your bank statement at the worst times. If you’ve ever been charged an overdraft fee, don’t worry, you’re not alone. Over 39 million adults have reported paying at least one overdraft fee in the past 12 months. . While it can be as simple as monitoring and adjusting your accounts, it can be complicated for individuals living paycheck-to-paycheck. Knowing the options available is important regardless of your situation.
Keep an Eye on Your Accounts
Actively managing the charges that hit your checking account will go a long way to preventing overdraft fees. Knowing when bills are scheduled to be paid from your account will help you ensure you have enough money in your account. Using online bill pay is one way to manage your bills safely and securely, providing a scheduling option to debit funds that align with your paychecks. Monitoring your bank balances several times a week will also help you identify potential overdrafts, which a funds transfer from another account can solve.
Link Your Accounts to a Credit Card or Savings Account
Some banks and credit unions offer the ability to connect your checking account to a savings account or a credit card to avoid overdraft fees. In the event of an accidental overdraft, your money will be transferred to your checking account to avoid an overdraft fee.
Charge Recurring Bills to a Credit Card
While it isn’t an option for all consumers, charging recurring bills to a credit card can be a great way to prevent overdraft fees from your checking account. Most overdrafts occur when consumers withdraw money and forget about an upcoming withdrawal. How do you reduce the chances of this happening? Minimize the number of direct withdrawals from your bank account and pay one payment to your credit card to cover recurring charges.
Setup Online Banking Alerts
Many banks offer account alerts that will email or text you when your balance hits a certain level. By monitoring these alerts, you can head off any unexpected overdrafts and avoid fees.
Opt-Out of Overdraft
When you set up your checking account, your financial institution likely gave you the option to opt-in or opt-out of Overdraft. By opting out, you are allowing the bank to limit transactions when they exceed the balance in your account. You may incur fees from a creditor, but you will avoid overdraft fees assessed by your bank.
KEMBA’s Helps You Avoid Overdraft Fees
As a KEMBA member, you can link your checking account to a savings account, credit card, or line of credit to cover overdraft transactions. In this case, the amount of the overdraft would be transferred automatically from the savings or credit card. Our savings to checking transfers are free and transfers from a credit card or a line of credit are available for a small transaction fee. We also offer a robust Digital Banking platform that provides access to your accounts to transfer funds, make online bill payments, make mobile deposits and more. Whether it’s account management or financial struggles that have you over drafting, KEMBA can help. We will work with you to discover options unique to your financial situation and can offer complementary financial counseling to help get you out of the cycle. Call us at 614.235.2395 and select Option 4 to learn about our options for checking, savings & more.