Here are a few you might try:. Get alerts : Ask your bank to tell you if your checking account drops to a certain level. Check in regularly : Make a habit of checking your account balance from your phone every day. It will only take a minute and will help you stay on top of your money all month long. Make it your new "zero balance. Ask for help : Check with your bank to see what other tools may be available to help keep your account in the black.
Dealing with an overdraft is a bummer, but mistakes happen. Knowing you have options can put you in a better position to manage your money and hopefully avoid getting into the red.
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For specific advice about your unique circumstances, you may wish to consult a qualified professional. El Issa, E. September 26, Pritchard J. Learn about overdraft protection plans. Overdraft line of credit. Dixon, A. Survey: ATM fees hit a record high for 14th year in a row. Debt Management. Your Privacy Rights. To change or withdraw your consent choices for Investopedia. At any time, you can update your settings through the "EU Privacy" link at the bottom of any page.
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What Are the Consequences of Overdrawing a Checking Account Even if you regularly peek at your bank balances online, it is possible to accidentally let your account fall negative, otherwise known as overdrawing your account. Key Takeaways If you have overdraft protection, your bank will let your account become negative but will charge you fees for every transaction.
Monitoring your account closely—and linking your checking account to a backup savings account—can help you avoid overdraft fees. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate.
An overdraft should be for short-term borrowing or emergencies only. This guide looks at how overdrafts work, how to stop going over your limit and how to avoid bank charges. An overdraft lets you borrow money through your current account by taking out more money than you have in the account. If you need to borrow money, there might be cheaper ways to do it. You agree a limit with your bank, and can spend money up to that limit.
Your bank will charge you interest, and sometimes other fees on top. This includes going over the limit of an authorised overdraft. Get started with Money Navigator , giving you instant help based on your circumstances. Get started. Major changes affecting your overdraft were introduced in April Interest on all overdrafts is now charged at a single annual interest rate APR , making it easier to compare charges between accounts. Contact your bank.
Banks might, for example, reduce or waive interest, offer a continuation of overdraft borrowing at the current rate of interest, or agree on a repayment programme, which might include a personal loan. Speak to your bank or building society as soon as possible. If you feel vulnerable for any reason, explain your circumstances and your provider is obliged to take this into consideration.
If you find yourself dipping into your overdraft frequently, you might want to use our Budget planner to take control of your money. Overdrafts can be useful for some people. They can help you avoid fees for bounced or returned payments. They could help you save money.
Use our Bank account fees and charges comparison tool to see all the fees and charges that apply to bank accounts — it shows everything from overdraft fees to foreign cash withdrawal charges. Comparison websites can help you find a current account tailored to your needs. Yes, you can switch using the Current Account Switch Service.
Make sure you check the charges and overdraft rules for each account. It may seem obvious but keeping track of your account balance is one of the best ways to avoid overdraft costs. If you then get an unexpected cost, you can still use your overdraft to pay for it.
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