Bank overdraft fees can be a huge burden when you are trying to stretch your paycheck, especially if you are part of the subprime demographic. Fortunately, there are a few steps you can take to help protect yourself and avoid these unnecessary costs. Let’s explore some specific actions you can take to reduce the likelihood of incurring an overdraft fee.
Check Your Balance Regularly
The first step is to check your balance regularly. This will help provide insight into how much money you have available so that you can plan accordingly and avoid spending more than what is in your bank account. When checking your balance, make sure to factor in any pending transactions that have not yet been processed by the bank, as this could result in an overdraft if the funds are not available when the transaction goes through.
Set Up Text Alerts or Email Notifications
Another great way to stay on top of your finances is by setting up text alerts or email notifications for when money is deposited into or taken out of your account. This will help ensure that you always know what is happening with your money and make it easier to proactively manage it. Additionally, many banks offer free text alerts that let customers know if their balances drop below predetermined amounts so they can take action before they incur any additional fees or charges. This functionality can be incredibly helpful for those who want more control over their finances without having to constantly check their accounts every day.
Use Autopay Whenever Possible
Autopay makes it easy to set up recurring payments for bills and other expenses so that they are taken care of automatically each month without any additional effort on your part. However, make sure that the funds are available in your account when you set up autopay – otherwise, you may incur an overdraft fee if the payment goes through but there aren’t enough funds in the account at that time. Additionally, since autopay comes with its own set of risks (such as late payments), make sure to review all terms before signing up for any services.
Take Advantage Of Overdraft Protection Services
If you find yourself consistently struggling with overdraft fees, consider taking advantage of an overdraft protection service offered by many banks and credit unions today. These services allow customers to link their checking account with another source of funds (such as a savings account) so that any transactions made beyond their current balance won’t incur any overdraft fees or penalties – instead, they will simply be covered by the linked account until sufficient funds become available again in the checking account itself.
Overdraft fees can have a significant impact on individuals who already have limited resources – especially those who belong to subprime demographics – so it’s important to understand how best to protect yourself from them. By regularly checking balances, setting up text alerts/email notifications for deposits/withdrawals, using autopay whenever possible and taking advantage of overdraft protection services offered by banks/credit unions whenever necessary – customers should be able to better manage their finances while avoiding unnecessary costs associated with frequent overdrafts and other banking mishaps!
