How to Prevent a Bank Overdraft

Bank overdraft fees are excruciating. Not only do you have the stress of knowing you are short on cash, you also have to deal with the $15 or $20 extra in fees. Of course there are circumstances that cannot be avoided, but for most people, spending too much is just an oversight. This article will teach you how to prevent a bank overdraft from ever happening again.

Difficulty: Moderate

Instructions

Things You'll Need:

• Internet access
• Computer
• Check registry

1. Sign up for an account with automatic bank overdraft protection. That means that your checking account is linked to a separate savings account. Although you shouldn't rely on this, you can dip into your savings if your checking runs short.

2. Keep a record of every debit card payment, check, withdrawal or credit payment. Write them in your check registry, or use a computer software program to keep track of them. If you're short on money it's one thing, but if you're just plain oblivious to the amount of money that goes in and out of your account every month, you deserve a bank overdraft.

3. Balance your checkbook everyday. It only takes a few minutes if you have a computer with high speed Internet access. Of course, your bank must also have online information, but most do now-a-days. This way you can tell how much money is still "free" and how much has yet to be claimed by one of your payees. This will prevent bank overdraft fees.

Tips & Warnings

• If you build in a small amount of money into your checking account, you won't have to worry about a bank overdraft. For instance, Record a debit of $10 when a sandwich only cost you $9. Over time, it adds up to a lot of protection.