Avoid Bank Overdraft Fees

So it has happened to all of us at some point in time – our bank account balance goes negative and we get hit with a nasty overdraft fee or two (or more). These fees were created by banks to give you the impression that you are being protected since they pay the vendor so the charge doesn’t bounce.

What the banks forget to mention is that in many cases this fee will cost much more than the amount you charged. For example, suppose your account goes negative and while negative you try to charge $1.00. Well the $1.00 will go through but you will most likely be charged a $40-$50 fee for paying that $1 – doesn’t make much sense does it?

In the end you could end-up bringing your account balance negative by a mere $20-$30 but pay over $300 in fees. If you like saving money then this is a situation that will potentially drive you to insanity as you watch your potential savings disappearance over a small amount of overages.

Don’t worry though – there is a simple way to solve this problem. Most banks will allow you to back-up your bank account with a credit card. This means that if your account is overdrawn the credit card will actually transfer money to your bank account and you’ll avoid the nasty overdraft fee. This can all be accomplished with a five-minute phone call and the savings it could represent from just a single overdraft event will be incredible.

So don’t let the bank make a fortune – instead you should save a fortune and avoid those overdraft fees like the plague. Of course as a good money-saver you should never let your balance go negative, but hey – you’re only human!