Overdraft fees can add up in a hurry
You may have gotten dinged in the past by an overdraft protection fee from your bank. According to the FDIC, a lot of us overdraw our checking accounts, and have to pay the penalty. It can add up in a hurry; the dreaded overdraft fee. Amanda Austin said, “Well I've only done it once, but it ended up being a couple of different transactions so it added up to about $95 or something.” According to a new FDIC study, it costs a customer any where from ten dollars to forty dollars if they spend more money than they have in their account. On average banks charge about $27 when you overdraft. Evelyn Bryant hates overdraft fees, “I think they are $35 for insufficient fund fees. And I just think that's too high.” According to the study nearly $2 billion in charges came from overdraft fees. The most common locations were the cash register and your ATM. But financial experts say these fees can be easily avoided. Financial planner Ross Marino said, “Before you go to the ATM, I would know two things, what is my balance today, and what bills are going to come out tomorrow.” According to the study, senior citizens keep the best track of their money with just over 10 percent of accounts getting overdraft fees. But young adults seem to struggle balancing their checkbooks with nearly half of the accounts getting charged. It helps to know your banks policies to avoid the fees, but that all starts when you first get the account. But Marino believes the survey will prevent these fees from rising, “I would expect in the future to see these fees challenged, disclosed more freely, and also come down.” Marino says you should always be careful when looking at your available balance because it might not take into account checks you've just written or big withdrawals scheduled for payments.

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Banks make money off fees... fees are not there as a deterrent..they are present to generate income. I have a handicapped brother, for the most part he is pretty good with his finances but not to the point he can monitor debit card use. So he doesn't use a debit card. Many, many times Alliance Credit Union has allowed him to present checks written for cash to the teller without suffient funds to cover them. They would give him cash and then charge him a $25 overdraft fee. What's really frustrating is with these kind of predatory policies it makes it that much harder for me to keep an eye on his finances. It's tough trying to explain to him that the check he just cashed for $40 just cost him $65.
add to the bottom line for the Banks. If you own stock in the bank, you want the fees to stay as they are.
Most Banks Like Suntrust, Wachovia and Bank Of America also post the largest purchases first, then the smaller amounts and bouncing even like a 50 cent debit purchase at $35 a pop plus late fees. I moved all my accounts away from those crooks and put it in a Credit Union. How do you think they pay all those high CEO's salaries and build those high rises! Thank God for the Credit Union, only $12 per overdraft for the once or twice slip ups I might make per year..I love SECU..you guys rock!
Consider it a penalty for being incapable of managing something as simple as a checkbook. I say raise the rates. Penalize the stupid. If you make it $100 per overdraft, it might force some of them to master basic addition and subtraction. There's nothing more annoying than irresponsible, incompetent twits whining about being called to task for their carelessness.
I agree 100%. Raise the NSF fee to $100.00. Then maybe people will learn basic addition and subtraction!
So, I believe there are some people that consistently overdraft however, I personally am capable of making a mistake. I know I am not perfect. I overdrafted two times in the history of my account which was 14 years old. The first time I overdrafted, I was hit with a $20.00 fee. This was at no fault to me. The bank charged an "inactivity" fee of $15.00 because I hadn't used the account in 6 months. They never mailed me a letter or anything. I ended up going negative about $10.00 plus the $20.00 fee. When I called the bank, no fees were waived and I had to pay $30.00 out of pocket for something that I had no idea existed. The second time I overdrafted, I had a simple mathematical error because I am human and I make mistakes. That mistake, I owned up to. Since, I have closed this account and moved my money and business to the credit union. It worked best for me. I have a problem with fees being charged by banks without letting the customer know that it could happen. I re-read all of my initial paperwork but when my previous bank was "bought out", nobody sent me any other agreements. To sum this up, all of us that overdraft are not always careless or idiots.
Many may have to use the overdraft as a "stretch" to payday. Knowing the penalty the "stupid" is willing to pay the fee. By increasing the fee it will only make matters worse. Taking away from gas or food. Besides the bank is making extra money for the "stupid" mistake. Have to consider there are many people still living paycheck to paycheck and many more living without a paycheck.
Take a break for a minute Commonsense! There are plenty of young adults coming up in the world that are making mistakes, and those that have yet to make them. Guess your silver spoon is still showing huh? Best policy is to have over draft protection for checking/savings. Don't forget that banks make errors too in their figures and can cause turmoil in someones life, and generally don't care much or even apologize after they've corrected it. Such was a case with me and Bank of America where it was a "typo" on their behalf...and didn't so much as say "we are sorry" or that they would apply my mortgage payment correctly next month. That was history with that bank...no more...and I'm glad you've never made the mistake of overdraft or had your bank fowl up your account Commonsense. Maybe you should change your name to...Mr. Perfect!
1. Attention to detail is important in life. Just because you're young doesn't mean you get a pass on being responsible. 2. Addition and subtraction aren't that difficult. Buy a cheap calculator if they kick your butt. 3. If you're having financial problems and are using overdraft protection for "payday loans," you have far bigger problems than your finances: You have somehow misplaced your brain. 4. For those who refuse to balance their checkbook, they can have instant overdraft protection at no cost. Get an interest-bearing checking account, deposit a buffer of adequate size to compensate for your carelessness, laziness, or lack of discipline, and don't include it in your balance. Forget it's there. I'm fifty-six years old. I've had a checking account since I was eighteen and making $138 a month. I've never had overdraft protection and never bounced a check. I'm not Superman and I'm not alone. MANY people exhibit the same degree of responsibility. Many people have never bounced a check in their life, and I believe that it's like so many other things, a generational issue. It seems that responsibility is optional for anyone born after 1960. Stop accepting mistakes. When we accept mistakes, we EXCUSE mistakes. (BTW Doc, if you think I was born with a silver spoon, you know absolutely nothing about me.)
I was born in 1962. I have NEVER bounced a check, even when I was a single Mother living off 11,000 a year with a mortgage and a car payment. So HA! I think the problem now is the debit card system. Unlike a credit card they do not tell you at the register that you have no available funds, they just pass it through and the bank pays it and zaps you with the fees. My step-daughter at 19 is a prime example of that.
1. Zippy, this first one is for your step-daughter: Keep your ATM in the pocket of your checkbook, NOT with credit cards in your wallet. If you have the register out when you're using the ATM, you have a much higher chance of writing the transaction down. Keep a pencil with the register - ALWAYS! 2. Unless one spouse is horrible with finances and bookkeeping, it is far better for a husband and wife to each have their own checking account. The surest route to disater is a husband and wife each carrying a checkbook for the same account. 3. Get that interest-bearing account I mentioned, deposit a couple of hundred dollars in it, and forget they're there. You get automatic overdraft protection and you're paying the fee to yourself in the form of monthly interest. (Albeit ridiculously low interest.) 4. Most banking errors relative to checking accounts are due to the check being keyed in incorrectly during the posting and clearing process. The fewer checks you write, the less your chance of facing an error. Locally, I use ONLY my ATM card - I never write a check at a store. Why would you? Swipe the card, enter your PIN, and you're out of there without handing them a hard-copy list of everything needed for identity theft. I pay my mortgage and credit cards electronically, which go computer-to-computer, and have little chance of a typo or data corruption. I also pay some recurring local bills like cable TV, alarm service, and trash, via auto debit on my credit card. That way I earn cashback rewards and do one electronic payment to the credit card every month that handles three bills. I just did a quick look at 2008 and while I average only 2.25 checks per month, I average well over 35 ATM and electronic transactions every month. I've been doing it that way for the last twelve years without even a minor glitch. Get yourself a good bookkeeping program and go electronic....but just in case we have a nuclear war or the Earth's magnetic field collapses, keep your addition and subtraction skills and pencil sharp.
for some of you. I have had overdrafts, once because my deposit was never credited, even with my dated/initialed proof of deposit(my deposit slip from the bank) taken to the banks president, nothing done except to offer to show me how to balance my checkbook, and no, my deposit never showed up. Naturally I left that bank. Second, I had direct deposit, and the FCU I had switched to kept putting my direct deposit in savings after having this "CORRECTED" with the bank several times that it was to go into checking. Needless to say I had overdrafts even though the money was in savings AND I had the paperwork showing that if I hadn't enough in checking the money would automatically come out of my savings. Guess what, it didn't. Even though they admitted repeatedly that it was their error, I still was charged overdraft fees that were never waived. Needless to say I once again moved and have finally found a bank that cares and does what it says it will. Moral? Be very careful where you take your money.
as with every post..you've had the last word, now we can move on....
...where the being was feeding off fear from the crew members. In his case, he feeds off of self righteousness. Quit answering him and maybe IT will go away.
"(BTW Doc, if you think I was born with a silver spoon, you know absolutely nothing about me.)" All I know about you is what I read in your anger and Course 101 on how to never make a mistake with mathematical figures. You come on as though you hate anyone that has ever had the misfortune of making an error in math. As I wrote before...banks make mistakes too. Does your anger diversify in their direction also??? Sounds as though the answer to that is NO. Sorry to say...but $138 a month doesn't require much banking activity to keep track of. By the way...I am 54 years old...have had a bank account since I was 18 as well. What of it?
Overdraft fees can eat them alive, for all I care. I don't want to hear them whining over a fee that they COULD have avoided had they exercised a bit of care and judgment. One of the biggest problems we face in this nation is people refusing to accept responsibility for their own actions. Nothing could possibly epitomize that any more than someone crying the blues over having to pay a fee caused by their own carelessness. If they can't balance a checkbook, they should use cash only. I'm sure that other than your banks error, you have bounced few checks. As far as the bank making errors, most involving checking accounts are due to keying entries as the check is cleared. I have seen three in my life, all in my favor. It's another sad commentary on our times to describe the odd stares and surprised looks I encountered as I explained to the bank personnel that the check they debited my account for $2.50 was actually paid out to the tune of $250.00, and that I owed them $247.50. (What was really humorous was that it had originally been keyed as twenty-five cents, someone realized that couldn't possibly be right, and there was the addendum strip taped to the bottom of the check for $2.50!) In your case, however, if the bank hadn't refunded all fees I would have involved the State Banking Commission and if need be, the Attorney General's Consumer Protection office. I don't accept institutional incompetence or irresponsibility any more than I accept it in individuals.
I know Commonsense comes off arrogant, but he's usually right, if you can get past that. What is wrong with personal responsibility?