Your bank or credit union cannot charge you fees for overdrafts on ATM and most debit card transactions unless you have agreed (“opted in”) to these fees. However, whether or not you opt in, you may still be charged fees for overdrafts on checks or ACH (automated clearing house = reoccurring) transactions.

Did you know that opted-in accounts are three times as likely to have more than 10 overdrafts per year as accounts that are not opted in? That’s $350’ish per year that is loss to banking fees.

I have always been morally against overdraft protection, but back when I was a teller… I taught myself how to sell it to others…because it was my job as the bank employee.

When I was the employee, I’d say something like “courtesy overdraft protection is good if you’re on your way back from vacation with $50 in your account and you get a flat tire. You can either have the transaction declined and figure it out, or (insert bank) can cover the tire, charge a fee, you get back on the road, and you can reconcile your money once you’re back.

But the reality well beyond the scope of my job at that time is that YOU should strive to be your own overdraft protection. Avoid spending every penny of your account, and make that the new normal. You can also setup a savings account that can backup your checking account and automatically cover your purchases if you accidentally spend too much.

If you don’t have a dollar, the last thing you need is -$36.

Reach out to your financial institution, discuss your current overdraft protection option, and figure out if it’s best for you.

Be your own financial advocate.

PS., You can often ask them to reverse/refund a couple of your overdraft fees once per year. So if you’ve made a mistake, ask for forgiveness…because they won’t give it out automatically.