Don’t spend more than you have, or you’ll be charged for it.
If you’re living paycheck to paycheck, chances are good you’ve got a system of sorts to keep you precisely squared at the end of every month. Unfortunately, a system like that only works when every last fee and payment remains completely consistent, and life is rarely so predictable. When you attempt to make a payment, manually or automatically, and you don’t have the funds to do so, your bank will wag its finger at you with an overdraft fee. These fees, while not usually large, are frustrating and can negatively impact your standing with your bank.
The best way to avoid overdraft fees is to keep regular tabs on the state of your funds. The simplest way to do this is to just check your balance on a daily basis. This is easier these days thanks to online banking systems, but if you don’t have consistent access to a computer or smartphone or don’t trust that stuff, you can also set up a balance alert. If your balance crosses a certain threshold, you’ll receive an automatic text or email warning. If you have more than one account, such as a separate checking or savings account, you can also link it to your primary checking account as a backup. That way, if a payment would overdraw your checking, it’ll instead pull the difference from the backup account.
Some banks offer overdraft protection on their accounts and cards, which makes them simply decline instead of overdraft. However, these systems aren’t infallible, as certain kinds of payments may bypass them. If you find that you’re being regularly hit with overdraft fees, you may want to consider switching to a different bank. Every bank prices their overdraft fees individually, so if this is a recurring problem, you can at least try to minimize the damage.