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Banks With No Overdraft Fees - Why There’s Only One

Congress gave the banking industry over $700 billion in bailout funds in 2008. Instead of passing some of that savings onto their customers, banks have increased their overdraft fees during a time of recession for the first time in 40 years. And yet, there is only one place in the United States that doesn’t charge overdraft fees on a checking account. Why is it not common practice to bank with no overdraft fees, and how can you get even with your bank?

Profitability

Banks won’t stop charging unfair fees, because fees make the banks a lot of money. The median cost of one overspending mistake was $27 in 2008, and the industry raked in about $29 billion in overdraft fees by the end of the year.

Easy blame

It’s difficult to defend a system based on “bad behavior.” By making an overdraft fee situation the customer’s fault, most people feel guilty enough to believe that the bank is justified. What they don’t realize is that they have the ability for their payment to be denied. This might not be a good thing for checks, but can you imagine how much trouble and money you would save by just having a debit card declined if you don’t have enough money in your account?

Technical camouflage

Banks are required by law to tell you what fees they will charge you, and when they will charge them. In fact, they give every customer a written agreement with all this information to sign before they open an account. But these agreements are so long that most people never read through them, and large overdraft fees usually come as a total shock.

How to get even

Don’t let banks take advantage of you with overdraft fees. Get educated by taking the time to read through the agreement you’ve signed with the bank. You’ll probably find that it’s not as complicated or as boring as you thought. After all, it’s about your money. Many agreements have section headings in a bold font to make it easier to find the information that you’re looking for.

If there’s something you don’t understand, you can call your bank and ask them about it, or you can go online and do some research. Take a look at how overdraft protection programs work and if your bank’s program would go well with your lifestyle and how you spend money.

And finally, be sure to address the things that make you uncomfortable. Ask your bank if it’s possible to change these practices. If they’re not interested in helping you, the most hurtful thing you can do is move your business.

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