While for many people the new laws on overdrafts mean that you’re not going to need debt relief or modification actions in the future, it also means that you can be put in an embarrassing spot at the cashier’s line.
Here are some ways to prevent yourself from being turned away at the counter, if you’re avoiding overdraft fees.
Keep in mind your available balance. Don’t think of your account as all of the money in it, but more of what is there that can be used – those are two separate amounts. Even then, you should keep track of your available balance every month and use your account accordingly.
Link your accounts. You can link a savings account to your checking account, so that you have a controlled overdraft fund of sorts. However, do remember that there are processing fees (about $10 per transaction), and that it’s better to have another, true savings account, just to be sure.
Apply for a credit line. If your rating is okay, then this is a viable idea – your bank will extend you a loan to cover for insufficient funds, and with competitive interest rates.
Keep a cash reserve. It’s best to keep a reserve of at least a hundred dollars when calculating the usable amount of money in your account. That way, if you do make a mistake in our tallying, you at least have an overdraft fund of sorts.
Cut the cards. Finally, you can survive on cash alone, and perhaps a basic ATM card. This way, your resources are limited to the cash you really have on hand. You will have less debt, but this is definitely a hard road to adapt to.
Sign up on the box at the right to find more options for debt relief and modification if you have overdraft concerns.
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