Using a checking account to pay for groceries, gas and other necessities may be a smart way to reduce debt and avoid credit card purchases, but it also comes with a risk: overdraft fees. If you are not careful when you are making purchases, then you can accidentally spend too much and face unexpected costs. Before you make another purchase, take a few minutes to reduce your risk of overdraft charges.

Set Up Online Banking

A simple way to determine how much money you have at any time during the month is with online banking. Many banks offer online banking services that allow you to keep track of your funds, transfer money from your savings account and identify potential problems that may occur.

When you know that your bank account is getting a little slim, such as shortly before your next paycheck, sign into your account and find out how much money is available. That will help prevent overspending so that you do not face high-cost charges.

Create a Buffer

If you have money in a savings account, then transfer some of it into your checking account as a buffer against overdraft fees. Depending on your bank, you may be charged, even if you still have money in the account, because it may drop below the minimum amount that you are required to maintain.

Creating a buffer with a few hundred dollars extra will help reduce your risk of facing high-cost fees.

Ask About Linking Accounts

Some banks may offer services to link your savings account or your line of credit with your checking account. If that is available, then link your accounts. In that way, your bank will automatically withdraw the funds from the linked account when you overspend.

Overdraft fees can add up quickly, especially if you keep spending when you’ve already exceeded the limit. Fortunately, it is possible to avoid those fees with a few simple tricks that ensure you have funds available when you need them.


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