Overdraft Fees and Protection Because Nobody is Perfect
Saturday morning rolls around and as I give a quick look at my phone with one eye open, my dog simultaneously does her patented Siberian husky hooooooowl that “I am ready to go and this is to alert you to get out of bed and off your phone, because it’s party time for me”. During this time I see an email from my bank alerting me of a low balance. This is not entirely uncommon, because when the end of the month comes, my transfers are occurring for larger amounts of money and I keep just enough around for a coffee or lunch during the week, which is well below the $100 alert I have set up. Right below that email was a Negative Balance alert, right then I said Oh S***! As I already mentioned today is Saturday, the business day ended on Friday and I was screwed. I made a personal finance mistake, spent more than I earned and caused my account to go negative! Please do not make me wear the Scarlet letter ‘A’ or conduct a Salem Witch Trial accusing me of personal finance witchcraft, because nobody’s perfect right.
After my Saturday morning walk filled with coffee, my dog nearly ripping off my arm after multiple squirrel chases, and a little cold rainy weather I was ready to see how much I owed for my stupid mistake. I logged in to see a bunch of negative amounts, fees, waivers, transfers, and a positive balance for those keeping score at home it looked a little like this guy to your right.
When I looked at my bank account I realized right away what had happened, my trusty 1987 Ross bicycle needed air this past week and when I noticed that the wheel was so dry that I could strip off the tire trim and see the inter-tube, that I needed to make haste to the local bike shop. At the local bike shop, the crafty salesmen not only suggested the tire, but an inner tube as I explained my bike most likely hadn’t had a tire change in the past 10 years or so. He offered to put on the inner tube and bike tire for a charge of $10, I usually attempt to at least give it the old DIY try, but since I already face enough danger on the construction crazed driver filled streets of Chicago, I decided that a loose or deflated tire didn’t need to add to my worries or Mrs. Even Steven. Well $36 and some change later and I find out why I am getting a Negative Balance alert, it was my 1987 Ross Bicycle.
The good news in this story is I have overdraft protection, so rather than a $36 Overdraft Fee, yep banks got to make money somehow and fees are one of the 3,142 ways they do, I was instead charged $12.50. If my options are $36 or $12.50, well I think it’s pretty clear which one I’m taking. The fee was listed as an Overdraft Protection Fee, honestly $12.50 to transfer over some money from another account because I forgot might sound like a stick in the eye, but remember banks are for profit companies and instead of a stick in the eye, they just want to poke you in the arm, don’t worry it will heal.
Waivers and Transfers
Apparently I am just full of good news because of the type of account with the bank I have they actually waive any fees when the transfer occurs from a linked account. So the waiver refunded the $12.50 like it never happened. In this case I had a little bit of money in a savings account, but I also had an old credit card that I keep linked. I don’t physically have the card, but I keep it open and on file for instances just like this, now I’m not a huge fan of credit cards sine I owed a ton of money on them not long ago, but today might be the only day that I can say I am glad I have one, I mean it saved me $36. I do owe my credit card $50, so I can either transfer from another bank or wait until I get paid in the upcoming week, so I suppose it’s not all bad.
Positive Balance and Lesson Learned
At the end of the day when I looked at my account, I had a positive balance. I made a mistake, I usually transfer the money I need right away after I make an unexpected purchase. I prefer to go with the method of not keeping money in my account very similar to why I don’t keep junk food in the house because this way I won’t eat it. Now it almost cost me $36 or $12.50 in fees, but I had my alerts and overdraft protection in place and the total damage was $0*. I should probably have a lesson learned from this personal finance mistake, but when the whole ordeal costs $0, it’s tough to see a lesson or something I should change in my finances. I thought about adding an extra $100 into this checking account to avoid any transfers taking place, but I guess the best lesson for me is that having Overdraft Protection on your account could save money, there lesson learned.
Do you have any lessons or suggestions you have learned from an overdraft fee or overdraft protection? Do you have overdraft protection on your account?
*No fees have been charged on my credit card that I know of, although I do have a $50 balance