I can’t think of anything I hate more than paying bank and credit card fees. I loathe it. I grit my teeth if I can’t find a way of getting the charges taken off of my account. Are you paying these 100% profit money-makers for banks? There is n o easier money for a bank or credit card company to make. You overdraft or go over the credit limit, they charge you $29 to $35 dollars. How many of you pay an annual fee just for having the credit card or bank account? Americans paid an average of $17.5 billion dollars in overdraft fees in 2006 according to the Center for Responsible Lending. My guess is that these people would rather just pay the fee without any fight, because it was better than the fees and hassle of the check or debit purchase being rejected.
The Other Side of the Argument: Look, if you overdraft, go over your limit, or are too stupid to pick a credit card without an annual fee, then you deserve to be charged for that service of not bouncing your check, debit, or credit purchase. I agree if you habitually overdraft without regard to the ramifications. If you aren’t living on a budget, you will find yourself overdrafting your account quite a bit, because it is so easy to swipe a debit card, and virtually everyone accepts it these days. However, some people have weird situations come up, or they transferred money over from their savings in anticipation of overspending their account, but the other charge shows up before your transferred money, and then you get like three separate overdraft fees all in one day. That happened to me one time, because I miscalculated how long it would take the money to get into my account. I was at least glad to see that Bank of America lowered their overdraft fee to $20, but I called and got them taken off, because I have been a customer with BOA since college and they saw that this is not a normal occurrence for my account.
The Solution To Not Paying These Horrible Fees Anymore.
- Ask to have the fees removed from your account. It never hurts to ask, and like I said before, this is a pure money-maker for the bank. They are not losing money if they take these fees off for you. I had three overdraft fees recently because of the reason I explained above, and the customer service representative specifically explained that because my account hardly ever shows any overdraft activity and I have been a customer with them for over five years, they would be happy to remove the fees from my account.
- Get on a written budget. We pay all of our bills online except rent, and then we budget out the rest of the money needed for the month, withdraw the cash from our account, and put it in envelopes by category of expense. Look down further on this page to read more about the envelope system in my related posts. A written budget that spends your money for you before it’s spent will strongly reduce paying pesky bank fees.
I’m sure other finance bloggers have written about this in the past, but it is preventable expenses such as this that drain our finances every month. If you want to win with money, you’ll have to clean up the expenses in your life that are preventable by education and a change of behavior.