PSA: Found a way to avoid those surprise overdraft fees that actually worked

I kept getting hit with $35 overdraft fees at my local credit union in Austin even when I was only a few bucks short. Drove me crazy for months. So I tried setting up a separate savings account linked to my checking as overdraft protection. You just authorize it to pull from savings if checking runs low. It cost me nothing to set up and now instead of a $35 fee I just pay a $5 transfer fee when it happens. That saved me like $80 last quarter alone. Has anyone else tried this or found another workaround that works better?

3 comments

3 Comments

hall.joel1mo ago

Makes total sense, man those surprise fees are the worst.

betty_kelly91mo ago

I did read somewhere that some banks are actually required by federal rules to let you opt out of overdraft coverage entirely, meaning they just decline the transaction instead of letting it go through and hitting you with a fee. I turned that on with my bank and it just bounces my card if I'm short, which is embarrassing at the register but way cheaper than $35. That savings account transfer trick sounds good too, $5 beats getting dinged every time you miscalculate your balance by a few bucks.

piper_kim1mo ago

Yeah, I used to just shrug it off as the cost of doing business, but @hall.joel is right that's a killer. This is actually making me rethink how I handle my accounts.