Be mindful of overdraft fees
If you make a transaction that exceeds what you have in your checking or savings account, you may be charged an overdraft fee. Alternatively, your bank may choose to not allow the transaction and instead charge you a fee for having insufficient funds. Thankfully, it's not hard to help avoid overdraft fees if you protect yourself with a few safeguards:
- Have your employer use direct deposit to put your pay check into your checking account. You get your money faster, and it saves you the hassle of going to the bank to ensure you have sufficient funds in your account.
- Keep some money in your checking account to act as a cushion in case of unexpected expenses. It’s suggested that you maintain at least $500 in your savings account as a backup in case that first cushion isn't enough and you need to transfer money into your checking account.
- Take advantage of both Online and Mobile Banking to access your balance information anytime, almost anywhere. Remember to factor in recent transactions that haven't appeared yet when determining your balance.
- Set up alerts on your accounts to help you track your balance and spending. Your bank may enable you to set up alerts to be sent to your email or mobile phone if your balance goes below a specific threshold.
- Consider overdraft services. For example, most Bank of America accounts are automatically set to a standard overdraft setting that helps reduce your chances of inadvertently overdrawing your eligible checking account. This service stops (non-recurring) debit purchases if there isn't enough money in your account or eligible linked overdraft protection account. Learn more about Bank of America's overdraft solutions.
These tips can help you avoid unnecessary bank fees and keep better track of the money in your checking and savings accounts.