Tag: Save Money

An overdraft fee or overdraft charge is completely unnecessary. If you know what to do when your bank charges you this fee, you won't have to pay it. Even if you've already been charged, there are several ways to get your money back from the bank. Let's see what an overdraft fee is and how to get the bank to return your money. What is an overdraft fee? An overdraft fee or overdraft charge occurs when you withdraw more money from your bank account than you have available. When this happens, your bank will charge you an additional fee to cover this transaction. In other words, the bank charges you an overdraft fee when you exceed the available balance in your account. Most banks charge $34 for each overdraft fee, which is way too high for lending you some money. The overdraft fees that some banks usually charge are: Chase: $34 Citibank: $34 Bank of America: $35 Wells Fargo: $35 US Bank: $36 PNC Bank: $36 What's worse, these overdraft fees are charged per transaction, which means that if you go over your limit multiple times a day, you will have to pay the overdraft fee for EVERY TRANSACTION. So while $34 may not sound like a lot, you could end up owing over $100 in fees if this happens several times a day. Fortunately, there are a few methods to negotiate the overdraft fee and get the bank to waive the overdraft fee. Let's see how to get an overdraft fee waived with a simple phone call to your bank. How to make the bank return an overdraft fee Many people don't know it, but: All bank charges are negotiable. Most banks understand that people are forgetful, so they are very willing to refund you for a first-time charge, but you MUST ask them to do so. However, you should know that this method will only work the first time (or at most once a year) so don't get used to spending more than the money you have in your account. Remember: The bank wants to keep you as a customer. A well-executed phone call can be worth the $34 you were charged. What to say when calling the bank If your bank has charged you an overdraft fee, you can get your money back by calling your bank's customer service (if they answer you in English, you can ask someone who speaks Spanish) and say something like this: YOU: “Hi, I just had an overdraft fee charged to my account and I would like to have it waived.” AGENT: I see you have been charged this fee. Unfortunately, we cannot refund the money collected. YOU: Well, I have been a good customer of the bank for several years and I would like to continue being your customer. As you can see, this does not happen to my account frequently and I would like to be refunded for this charge. What else can you do to help me? AGENT: I'm going to check with my supervisor. Can you wait a second? YOU: AGENT: I was able to check with my supervisor and return the amount charged for the overdraft. Is there anything else I can help you with today? It's that easy! You've already saved $34 on the overdraft fee. When calling your bank you must take into account: If it's your first time, usually the bank will refund your money for the overdraft fee. If they tell you it's not possible, don't give up easily. Ask the agent what else they can do for you (by being nice and not demanding). Use time in your favor. If you have been a customer of the bank for several years, mention it. Be firm without being disrespectful. Nothing can hurt a negotiation like turning sour quickly or having a bad attitude. This method doesn't just work for overdraft fees. You can also use it for other bank fees, such as processing fees, late fees, and even ATM fees. What to do if the bank does not return the money There is always the possibility that the bank will deny your request to waive the overdraft fee. When this happens, there are three options you can take: Banks pay hundreds of dollars to acquire new customers and they don't want to lose you. If you are persistent enough, you will have the upper hand and get your money back. Call again. Sometimes getting the overdraft fee waived is a matter of finding the right bank representative. If the first bank representative doesn't help you, kindly thank them for their time, hang up, and talk to another representative. Pay the fee. You are not always going to win every negotiation. Sometimes you will have to pay the overdraft fee (especially if it is more than one). But don't lose anything by calling and applying. Say goodbye to the overdraft fee: How to prevent it from happening again When it comes to overdraft fees, the best thing you can do is learn how to root them out. There are 4 ways to avoid overdraft fees once and for all: Open a checking account that DOES NOT charge overdraft fees. Disable overdraft protection from your bank account Use account transfers envelope system Open a checking account that does NOT charge overdraft fees Many banks offer good checking accounts with no fees. Our Favorite Checking Account: The Charles Schwab Bank Checking Account. We like it for several reasons: They do not charge monthly commissions They offer free overdraft protection checks are free You can withdraw money from ANY ATM worldwide without paying a commission (ATM fee) They refund the commission charged by other banks when using their ATMs The only downside is that Schawb doesn't have as many offices as other banks ( you can find a branch here ), but it is NOT necessary to visit a branch to open this account. However, when was the last time you visited a branch of your bank? This is less and less necessary. We like this account because you can use ANY ATM without paying commissions. Literally whatever and they'll refund your ATM fee at the end of the month. Turn off overdraft protection When you open a bank account, many banks automatically activate overdraft protection. In this way, the bank is authorized to "lend you the money" you need when you spend more than what you have in the account. Sounds great, but they don't tell you that they will charge you more than $30 FOR EVERY TRANSACTION without funds. So it will be better to disable overdraft protection. This way, if you don't have enough funds to cover a transaction, your card will simply be declined and you won't have to throw your money away paying the overdraft penalty. Sure, this could be embarrassing if you're at the store and you can't afford to pay for your purchase, but the $34 in your pocket will be more useful than the temporary embarrassment you may experience. Account transfers Some banks offer an overdraft protection service (called overdraft protection ) that works by transferring money from another account if you don't have enough funds to pay for consumption. For example, let's say you are paying with your debit card at a restaurant. If you don't have enough money in your account to pay, but you do have money in your savings account, the bank will transfer the money from your savings account without charging you an overdraft fee. NOTE: Some banks also charge a fee to transfer the money, although this is usually less than the overdraft fee. Envelope Expense System If you've been charged an overdraft fee, you may need some help managing your money better. So use this tip to achieve it. This is also a great system to help you save without being on a strict budget. Here's how it works: At the beginning of each month, divide your cash into categories: money to go out Food Gasoline … and any other expenses Use envelopes for each category you have and keep your money in these envelopes. Once you've spent the money on those packs, you'll be able to manage yourself better and you'll know that you've already reached your limit for that month. We also recommend starting a reserve envelope so you have an emergency fund and can start saving money. If you have more questions about what an overdraft fee is and how to get your money back from your bank, leave us a comment and we'll do our best to help you.