5 Easy Ways To Avoid Bank Overdraft Fees

5 ways to avoid bank overdraft charges

Bank overdraft fees have hit most of our accounts at one time or another. Some of us try our best to avoid them, and others seem to incur them time and time again. This costs us money, and obviously money we do not have since our accounts already have insufficient funds. Let’s look at 5 easy ways that we can avoid bank overdraft fees.

1. Disable The Ability To Overdraft On Your Bank Account

Yes, you can simply contact your bank and tell them not to allow your account to overdraft when funds are insufficient. Most banks will allow this option for your accounts. This will avoid most overdraft fees as some automatic payments may still process. You will have to check on your account agreement for more details.

One downfall to turning off overdrafts on your account is that purchases will be declined if you do not have enough funds in your bank account. This can be embarrassing in certain situations, or may leave you stranded if you are in an emergency situation and need to make a purchase.

Opting out of over drafting is the best way however to avoid that dreaded $35 bank overdraft fee.

2. Setup Low Balance Alerts on Bank Accounts

Most bank account will allow you to setup low balance alerts to let you know if your bank account is getting close to being overdrawn. You can choose an amount that will trigger a notification, and then have an email or text message sent to you in the event that the low balance limit is reached on that bank account. You can then be cautious of your spending on that bank account in order to not overdraft on the account avoiding any overdraft fees due to insufficient funds.

3. Budget Your Money

People that have a budget know how much money they have coming into an account and also how much is going out, to where, and when. If you have a budget and manage it well, you will most likely not overdraft on your bank account. Planning and budgeting your spending will let you know well in advance if your bank account is in danger of over drafting. While budgeting and seeing that your account may end up negative, you can plan accordingly and adjust spending habits so that the account funds will not be insufficient resulting in overdraft fees.

4. Setup Automatic Overdraft Transfers

Some banks will allow customers to setup another linked bank account, such as their savings account, to automatically transfer funds from one account to the other in the event of an overdraft. If your account is over drafted say $20, that $20 will be automatically transferred from the linked account in over to cover the overdraft and avoiding any fees from the bank. Check with you bank to see if automatically transferring fund from a linked bank account in the event of an overdraft is available.

5. Monitor Your Bank Account Balances and Transactions Frequently

You should be constantly monitoring your bank account balances and transactions on a regular basis. If you view balances often, you will have a good idea of what you can spend before overdrafts will occur. You should also review every transaction on your bank account to make sure that they are legit and the amount of each transaction is correct. You may know how much you should have in your account, but transactions that you are unaware of may put your bank account in jeopardy of being over drafted and having fee imposed on you.


To sum up, there are 5 easy steps you can take to avoid insufficient funds in your bank account and avoid overdraft fees. Simply decline the ability for your bank account to overdraft, setup low balance alerts on your bank account to get notified when funds are getting low, budget your money in your bank accounts, setup automatic overdraft transfers, and monitor your bank account closely and frequently.

Taking these 5 simple steps will help you to ensure you will not over draft your bank account and avoid any type of overdraft fees from your financial institution.