Really? No More Bank Overdraft Fees and Over the Limit Credit Card Fees?
May 28th, 2010 | 
Author: 
In these troubled times many people are facing such serious financial difficulties that the government has finally stepped in to help out. It i time to become educated so that you are a forewarned and forearmed consumer.
Before I go into opt-in overdraft and over the limit coverage regarding banking and credit cards, it is a good idea to get a clear understanding of the new laws that will be enforced as of August 15, 2010.
During this time of a recession in which everyone around the world is having difficulties with their finances most people are looking for ways that we can save money. One of the ways we can save money is by paying attention to what we truly can’t afford. The fact is having overdraft protection and being able to go over our limit on credit cards has made us lazy and kept us in debt.
This laziness has generated an estimated amount of $20 billion from the overdraft fees on debit card purchases and ATM transactions in 2009. In addition to overdraft fees that sometimes can be as much as $35 per charge, banks have generated an additional $12 billion by covering checks and recurring bills.
Under the new law banks will no longer be able to allow their customers to spend more money than they have in their checking account using their ATM or debit cards. For many people this brings a huge sigh of relief. While it may be a little bit embarrassing to have your card rejected at the grocery store or perhaps a restaurant etc., is well worth it when you consider the financial cost of going over your credit card limit or spending more than you have in your checking account. The result of this being high overdraft and over the limit fees.
Imagine if you were charged $35 per incident and without realizing it you made four different purchases that added up to $20 over the amount of money you actually had in your checking account. Your overdraft fees would add up to $140! This type of thing happens all the time. That is why it is an extremely profitable way for banks to obtain your money. Even going over just a few dollars can cost you $35.00 in overdraft charges.
What the government has done is plugged this loophole and no longer are banks allowed to let you spend more money than you have in your checking account when you use your debit or ATM card.
Now, the banks have to sway or scare you into opting-in to overdraft protection regarding ATM and Debit card transactions. If you do not opt-in you won’t accidentally spend more money than you have. That doesn’t sound so bad now does it? No more overdraft charges to eat up your monthly income.
The banks can on the other hand continue to allow you to spend more than you have if you use a check or allow your bills to be paid through automatic withdrawals from your checking account.
So it’s time to pay attention. Know your spending limits. Keep enough cash on hand to fill your gas tank or unexpected expenses. This is a good thing for us. But beware of the persuasive tactics soon to come because banks and credit card companies are not going to give up their $20 billion dollar profits that easily.
Posted in Debit Card Protection | 
Tags: Bank Overdraft Fees, Banks, Credit Cards, Debit Card Purchases, Debit Cards, Financial Difficulties, Laziness, Little Bit