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Fed Up With Fees?

Americans are still paying a lot in overdraft fees

Americans just can’t seem to quit overdraft fees. According to a recent report from banking consulting firm Moebs Services, American consumers shelled out a total of $34.3 billion in those charges last year. This, despite the fact that overdraft protection is an optional service.

Something is not clicking with consumers, because research shows that Americans do not want to get hit with overdraft fees. A report from NerdWallet found that 38 percent of Americans consider paying a $20 banking fee more annoying than waiting in line at the DMV. Yet the same study found that 16 percent of Americans would do “nothing” to avoid money management fees. This makes little sense, as reducing overdraft fees is as simple as going to your bank’s website or making a phone call.

If you’ve been hit with an overdraft charge, first check your bank’s site to see if you can remove the service from your account. If that option isn’t available online, simply call the bank and explain that you’d like the charge waived and to have it overdraft protection removed from your account. If you get any pushback, explain that you’re a good customer and might have to switch banks if there’s nothing they can do. You’ll likely be surprised how quickly their tune will change. Once the service is removed, if you try to make a purchase with your debit card that puts your account in the red, the charge will be denied. With the overdraft protection, the charge would go through, and the bank would charge you a fee.

Keep in mind that you can only remove overdraft charges for one-time purchases made with your debit card. As CNBC reports, the protection cannot be removed from transactions with checks or automatic payments that you’ve set up. If you are incurring overdraft fees in those ways, try monitoring your account more often so that your balance never sinks too low.

Chris O'Shea

Chris O'Shea