Protecting your accounts from overdrawing
If you have a checking account you have probably already heard of overdrawing your account. In fact you might actually be one of those people who have overdrawn your account. The worst thing about overdrawing your account is that every time you overdraw your account you are going to incur some kind of fee and will probably be charged interest. But the worsdt thing is that if you overdraw your account and don't have any kind of overdraft protection your bank can actually send the check back to the person you wrote it to and then you not only incur charges from your bank but you also get the charges from the other bank as well. It is these charges that can actually add up and cause you to constantly overdraw your account just in order to keep things current. But the good news is there are some things that you can do to protect your accounts from overdrawing.
Here are some things that you can do to protect your accounts from being overdrawn.
Number one:
The first thing that you can do to make sure that your account is not going to be overdrawn is to keep a running balance of your bank account. This does not have to be an exact balance but you are going to need to know about where your money stands so that you will know if you have enough in your account to cover any purchases that you might make. So basically you are going to want to know an estimated balance of your account at all times.
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Number two:
The next thing that you are going to need to do is to be aware of any debits that are going to be made to your account on a recurring basis. Basically these are your automatic payments that you have set up through merchants to cover utility bills or to pay for a service. You are going to need to be aware of when these debits are going to occur and then factor them into your account balance. Most of the time what happens is people forget that an amount is set to be withdrawn on a certain date and then they spend that money on another purchase.
Number three:
You are also going to need to be aware of any money that is taken out of your account at an ATM and any checks that are written on your account, this is especially important to keep close track of if you have two people on the checking account. You are going to need to know about the other person's activities as well as your own so that you can keep an accurate estimated balance in your checking account so that you don't overdraw the account.
Number four:
Another thing that you need to do is to wait for any checks that you have deposited to clear your bank before using them as available funds. The reason for this is that sometimes those checks might not clear the other bank so that means the money is never put into your account. And if you have already counted on that money and have added it to your balance and spent it you are going to be short on that amount of money. Most checks clear within 3 to 5 days and some banks even have a holding period, check with your bank to find out their policy.
Number five:
The last thing that you can do to protect your accounts from overdrawing is to sign up for overdraft protection from your bank. What is actually offered will depend on your bank, but most often you will be charged interest on the actual amount that you overdraw and on how many days you remain overdrawn. But some banks will charge you a flat fee for each time you overdraw your account.
