Overdrafts occur when you spend more money than is actually in your account. In a nutshell, the best way to prevent the resulting overdraft fees is to know your daily balance, manage your monthly budget and try not to spend more money than you have available.
We’ve assembled some beneficial habits that will help reduce your chances of an overdraft, and help you better master your finances in the process!
These days, online and mobile banking are incredibly easy and common ways for you to check your account balance anytime, anywhere. Regularly reviewing your account will keep you informed of where your finances are at. It will also help you spot potential fraud, should you notice anything out of the ordinary.
Track all payments via spreadsheet, on paper or with daily check-ins to your online account balance(s). That includes spending via check, debit card, ATM or any automatic payments you’ve set up, as well as any monthly account charges. The idea is to know your balance and how much money is currently in your account.
Take the time to read and understand your bank’s overdraft policies. You’ll receive a deposit account agreement and schedule of fees when you open an account, and these terms include information such as fee limits or recurring fees.
With Gate City bank, you have a choice of two different options for overdraft protection: savings or credit. Ask about linking your savings as a back-up to your checking account to avoid overdrafts, or apply for a checking reserve line of credit to be better prepared for unexpected expenses. (With this offering, you borrow against your own line of credit to cover overdrafts on your checking account. You can work with a lender to learn more about specific terms and limits.)
At Gate City Bank, we believe in helping you create a better way of life. Part of that purpose involves making sure you have the tools and know-how you need to avoid overdrafts and the fees that come with them. And rest assured, we have additional resources and options to give you extra peace of mind and protection from overdrafts. Contact us today to visit with one of our knowledgeable team members!