topic Re: Banks & Overdraft Protection in SmorgasBoard

Banks & Overdraft Protection

laz98 — Thu, 04 Feb 2010 21:26:16 GMT

Okay, this post is mostly to vent, but I'm curious how many of you feel the same way...

Yesterday I was reading on another forum about how someone was upset that their bank let charges go through on their account, even though they had insufficient funds to cover those charges. She was upset about all the fees, & how it was messing up her budget. Rather than take responsibility for her actions though, she chose to blame the bank, questioning why they have such a stupid policy of letting you run your account way into the red.

About 12 other people posted, saying the exact same thing! Then, when one girl tried to point out that she should have kept a closer eye on her finances, everyone jumped down her throat about how hard it is to be on a budget, & why banks should not allow overdraft protection.

I chimed in a couple of posts later, agreeing with the one dissenter, saying that banks are in their line of work to make money, not to manage their customers' finances for them. Of course, nobody wanted to hear that, & another lady jumped down my throat about putting myself in her shoes, that I had no right to tell her how to feel about the situation, & that living paycheck to paycheck is sometimes harder than it seems.

Ultimately, the post got closed by the moderator; they are very sensitive over there about people's feelings getting hurt. What do you think?

Re: Banks & Overdraft Protection

Anonymous — Thu, 04 Feb 2010 21:31:03 GMT

I think misery likes company. And those without responsibility make very annoying people to be around.

i HATE that sort of thinking. But I also see it on here. People are mad because their credit card companies are lowering limits or closing accounts, collectors trying to collect legit debts. At some point something ahs to be the consumer's fault. Very few are willing to take that on, however, because its always easier to blame those nameless faceless big money banks and such.

Re: Banks & Overdraft Protection

MidnightVoice — Thu, 04 Feb 2010 21:37:09 GMT

Mixed feelings. Overdraft fees are logical, but when a bank allows you to become overdrawn via a debit card and charges $30 bucks for that transaction, plus another $30 bucks for the coffee you had later, I get a little upset. 5 cups of coffee later you oweover $200.

They are setting up the less careful people up for trouble, and the level of the charges are ridiculous, especially in this electronic age. It would be simple to add a warning to the screen, or give you the option NOT to be overdrawn.

And careful as I am, a miscommunication between DW and I caused this to happen to me. (and to all the women reading - I am NOT blaming her - we were both to blame!!!)

Re: Banks & Overdraft Protection

demi — Thu, 04 Feb 2010 23:17:38 GMT

I can understand where you are coming from, but I think if I use an ATM and I don't have the money, it shouldn't go thru. Checks might be different...its nice if they cover. Then you deserve the fees. Same thing with overlimit on a credit card...don't let me charge it and then charge me an overlimit fee...that is just wrong. As embarrassing as it would be, I would rather have it denied.

Re: Banks & Overdraft Protection

laz98 — Fri, 05 Feb 2010 00:55:09 GMT

@demi wrote:
I can understand where you are coming from, but I think if I use an ATM and I don't have the money, it shouldn't go thru. Checks might be different...its nice if they cover. Then you deserve the fees. Same thing with overlimit on a credit card...don't let me charge it and then charge me an overlimit fee...that is just wrong. As embarrassing as it would be, I would rather have it denied.

i understand the frustration that people have with charges going through without the funds to back those charges up...but then, why don't people just make sure they have the money in there? isn't that really our responsibility, because it's our money?

i mean, really...the banks couldn't handle their own money...do you trust them to manage yours?

Re: Banks & Overdraft Protection

haulingthescoreup — Fri, 05 Feb 2010 01:06:19 GMT

My feeling about OD fees is that it's yet another way for banks to gleefully make some money off of us. Yes, there is absolutely no reason on God's green earth to bounce a check or overdraw an ATM card, but it does happen (especially with ATM cards and couples, as MV posted.) Nevertheless, it doesn't "cost" the bank a fraction of that $39 fee to cover a tank of gas or whatever triggered the OD. These things are cash cows for banks, pretty much free money for them.

Like so many other things, these fees are a tax on stupidity. OK, a tax on carelessness. The more stupid (or careless) one is, the more money one pays.

One of the many (many, many) things I like about USAA is that we can link a CC to checking for OD coverage, and if it's used, there's no fee, other than the fact that it's treated as a cash advance on the CC and the meter starts ticking from day 1. Mine has been used twice, once for a subtraction error I made on my checkbook register (oh, the shame) and once when an automatic just-in-case payment kicked in, when I didn't think it would be triggered. Each cost me about 80 cents, I think, because I found it the next morning and covered it.

Meanwhile, my kids lost a ton of money in their teens on their checking accounts, OD'ing with their debit cards. It took years for them to finally believe that what the automated phone line told them was their balance wasn't necessarily their balance. They had to learn the hard way.

Re: Banks & Overdraft Protection

bicknar — Fri, 05 Feb 2010 02:21:12 GMT

OK, 2 sides of my opinion on this.

Right. Charge me for overdrawing. I understand that for the bank services provided they get to use my money to make interest on investments. When I overdraw I'm breaking that business contract.

Wrong. Manipulating the books to maximize income on chargest. e.g I have $100. in my account. I have one check out for $100 and 5 checks out for $10 each. They all post on the same day. Don't arrange them so that the 100 goes first and you hit me with 5 late fees. That's just cruel. But wait, I had a deposit that went in the next day for another $100. And my next checks start to bounce because i'm still negative after the 5 $39.00 overdraft fees.

There is a line between doing business and making money.

Re: Banks & Overdraft Protection

Anonymous — Fri, 05 Feb 2010 03:10:05 GMT

@laz98 wrote:
Okay, this post is mostly to vent, but I'm curious how many of you feel the same way...

Yesterday I was reading on another forum about how someone was upset that their bank let charges go through on their account, even though they had insufficient funds to cover those charges. She was upset about all the fees, & how it was messing up her budget. Rather than take responsibility for her actions though, she chose to blame the bank, questioning why they have such a stupid policy of letting you run your account way into the red.

About 12 other people posted, saying the exact same thing! Then, when one girl tried to point out that she should have kept a closer eye on her finances, everyone jumped down her throat about how hard it is to be on a budget, & why banks should not allow overdraft protection.

I chimed in a couple of posts later, agreeing with the one dissenter, saying that banks are in their line of work to make money, not to manage their customers' finances for them. Of course, nobody wanted to hear that, & another lady jumped down my throat about putting myself in her shoes, that I had no right to tell her how to feel about the situation, & that living paycheck to paycheck is sometimes harder than it seems.

Ultimately, the post got closed by the moderator; they are very sensitive over there about people's feelings getting hurt. What do you think?

For the life of me, I can't figure why someone would ever use a debit card when you could use a credit card.

Anyhow, overdraft charges for debit card transactions should be eliminated completely. In their place, banks should institute a $50 fee for each time a debit card is declined due to insufficient available funds.

Re: Banks & Overdraft Protection

laz98 — Fri, 05 Feb 2010 03:45:07 GMT

@bicknar wrote:

Wrong. Manipulating the books to maximize income on chargest. e.g I have $100. in my account. I have one check out for $100 and 5 checks out for $10 each. They all post on the same day. Don't arrange them so that the 100 goes first and you hit me with 5 late fees. That's just cruel. But wait, I had a deposit that went in the next day for another $100. And my next checks start to bounce because i'm still negative after the 5 $39.00 overdraft fees.

There is a line between doing business and making money.

I agree this is wrong, or at least unfair, & it drives me nuts. But I guess the same way that they can choose how to do business, we have to choose WHO to do business with. I know that Chase can do this to me, so I make sure it doesn't happen. I'm not really in the habit of just gifting my money to greedy banks.

Re: Banks & Overdraft Protection

laz98 — Fri, 05 Feb 2010 03:46:43 GMT

@Anonymous wrote:

For the life of me, I can't figure why someone would ever use a debit card when you could use a credit card.

Anyhow, overdraft charges for debit card transactions should be eliminated completely. In their place, banks should institute a $50 fee for each time a debit card is declined due to insufficient available funds.

i never use my credit cards, unless i'm out of cash for some reason. i use my chase debit card AS a credit card for every single thing possible.

i bet if they instituted even higher fees than the ones people complain about now, people would learn REAL QUICK to keep their books in check! or else suffer

Re: Banks & Overdraft Protection

fused — Fri, 05 Feb 2010 03:51:50 GMT

bicknar wrote:

OK, 2 sides of my opinion on this.

Right. Charge me for overdrawing. I understand that for the bank services provided they get to use my money to make interest on investments. When I overdraw I'm breaking that business contract.

Wrong. Manipulating the books to maximize income on chargest. e.g I have $100. in my account. I have one check out for $100 and 5 checks out for $10 each. They all post on the same day. Don't arrange them so that the 100 goes first and you hit me with 5 late fees. That's just cruel. But wait, I had a deposit that went in the next day for another $100. And my next checks start to bounce because i'm still negative after the 5 $39.00 overdraft fees.

There is a line between doing business and making money.

A

+1!!!!!!!! I agree 100%. Banks should be required to debit accounts as the charges are received.

Re: Banks & Overdraft Protection

MidnightVoice — Fri, 05 Feb 2010 13:33:49 GMT

The banks in England got sued for charging too much for this, and lost, and had to pay it back

It was salled usury

Re: Banks & Overdraft Protection

Anonymous — Fri, 05 Feb 2010 13:35:55 GMT

@MidnightVoice wrote:
The banks in England got sued for charging too much for this, and lost, and had to pay it back

It was salled usury

I read somethng about that. Pretty funny! I think the banks there are still peeing blood over having to pay.

Re: Banks & Overdraft Protection

MidnightVoice — Fri, 05 Feb 2010 21:37:40 GMT

Back to the original point - I use USB, and last year I got one of their CCs as it has overfraft protection on it, just in case.

Re: Banks & Overdraft Protection

Anonymous — Sat, 06 Feb 2010 04:27:12 GMT

@MidnightVoice wrote:
Back to the original point - I use USB, and last year I got one of their CCs as it has overfraft protection on it, just in case.

I think it's always a good idea to have OD protection in some form. I like PenFed and Navy Federal's OD line of credit products, but even using a CC as OD protection is a wise move ... better 1 or 2 days interest as a cash advance than getting hit with OD fees or bounced check fees.

Re: Banks & Overdraft Protection

Anonymous — Sat, 06 Feb 2010 06:54:38 GMT

I work for a bank and I have to say that I agree with the fees. The fact of the matter is you can go run your debit card as credit and clean your account out completely and it would take several days for the charges to actually hit your account depeding on how it's coded by the merchant. In the mean time you could write checks or come in and withdraw the cash, all before the transactions you already did clear the account. If the bank did not provide you with over draft protection then you would pay a fee to the bank and a fee to the merchant. With overdraft protection you only pay the fee to the bank. I small price to pay for being irresponsible. It is not the banks job or their place tokeep track of your spending.

I haven't paid a NSF fee in YEARS. Not becuase of some employee perk. I would be fired for overdrafting my account. But because I am extremely responsible with my monery. You see you get this really nifty little thing called a check register and you track your spending. Personally, I keep all of my reciepts and use an excel spreadsheet that I created each night to balance my check book before I go to bed. Then you use online banking to make sure that there isn't anything coming through that you forgot about. Also ALWAYS keep emergency cash in a savings account so that you can transfer it over if you see that you over spent. If you prefer not to be quite so obsessive about your spending then you could do what my husband does. He puts it all on one credit card that he keeps for daily expenses. Then he transfers his entire allowance to his card each pay period.

My husband and I also have seperarate checking accounts, plus a third account that our direct deposit goes in to and we use to pay the set bills, ie mortgage, our allowances, car insurance, credit card payments, the stuff that doesn't fluctuate. In case of emergency, I'm joint of his, he's joint on mine. Other than an emergency though, I use my account and he uses his. We both get an allowance that is a set amount that come out the budget.

Learning responsible money management did not happen over night, but eventually we both realized that we didn't want to donate anything more to the bank and the only way to stop was to start tracking our money.

Re: Banks & Overdraft Protection

Anonymous — Sat, 06 Feb 2010 07:52:09 GMT

@Anonymous wrote:
I work for a bank and I have to say that I agree with the fees. The fact of the matter is you can go run your debit card as credit and clean your account out completely and it would take several days for the charges to actually hit your account depeding on how it's coded by the merchant. In the mean time you could write checks or come in and withdraw the cash, all before the transactions you already did clear the account. If the bank did not provide you with over draft protection then you would pay a fee to the bank and a fee to the merchant. With overdraft protection you only pay the fee to the bank. I small price to pay for being irresponsible. It is not the banks job or their place tokeep track of your spending.

I haven't paid a NSF fee in YEARS. Not becuase of some employee perk. I would be fired for overdrafting my account. But because I am extremely responsible with my monery. You see you get this really nifty little thing called a check register and you track your spending. Personally, I keep all of my reciepts and use an excel spreadsheet that I created each night to balance my check book before I go to bed. Then you use online banking to make sure that there isn't anything coming through that you forgot about. Also ALWAYS keep emergency cash in a savings account so that you can transfer it over if you see that you over spent. If you prefer not to be quite so obsessive about your spending then you could do what my husband does. He puts it all on one credit card that he keeps for daily expenses. Then he transfers his entire allowance to his card each pay period.

My husband and I also have seperarate checking accounts, plus a third account that our direct deposit goes in to and we use to pay the set bills, ie mortgage, our allowances, car insurance, credit card payments, the stuff that doesn't fluctuate. In case of emergency, I'm joint of his, he's joint on mine. Other than an emergency though, I use my account and he uses his. We both get an allowance that is a set amount that come out the budget.

Learning responsible money management did not happen over night, but eventually we both realized that we didn't want to donate anything more to the bank and the only way to stop was to start tracking our money.

Although I agree in part -- especially about the check register -- but the fact is that with a debit card purchase the merchant obtains an authorization upon swiping the card. That authorization shows up immediately in the bank and the bank automatically freezes that portion of your available funds. You simply are not able then to withdraw that money from your account.

Re: Banks & Overdraft Protection

Anonymous — Sat, 06 Feb 2010 13:20:15 GMT

@Anonymous wrote:
Although I agree in part -- especially about the check register -- but the fact is that with a debit card purchase the merchant obtains an authorization upon swiping the card. That authorization shows up immediately in the bank and the bank automatically freezes that portion of your available funds. You simply are not able then to withdraw that money from your account.

That's not always the case. Again, it depends on how it is coded by the merchant. Sometimes it is an imediate thing, but I've had transactions that have taken days to even show as pending on my account. This is especially true of online pruchases.I think as technology advances it will become more instantaneous, but we're just not there yet.

But the fact of the matter remains, the only person responsible for tracking your spending and keeping up with your finances is you. I see it every day. People come in and knowingly place there account in a negative status and then come in screaming cause they want to know why they have fees and what happened to all their money. Some of them are young and dumb and just learning cause they're new, but you'd be surprised how many older adults who ought to know better can't seem to keep up with there money. It's insane.

Re: Banks & Overdraft Protection

haulingthescoreup — Sat, 06 Feb 2010 14:05:02 GMT

sllbaker wrote:

I haven't paid a NSF fee in YEARS. Not becuase of some employee perk. I would be fired for overdrafting my account...

Now that's one way of getting people to smarten up!

And +1,000,000 on the check register. Just brought mine current last night before I turned out the bedside lamp. It's either every morning or every evening, and sometimes it's both.

I'm glad I have my OD protection, and I'm glad that I've barely ever used it. And paid it back the next day when I realized what had happened.

Re: Banks & Overdraft Protection

Anonymous — Sat, 06 Feb 2010 14:28:54 GMT

@haulingthescoreup wrote:
@Anonymous wrote:

I haven't paid a NSF fee in YEARS. Not becuase of some employee perk. I would be fired for overdrafting my account...

Now that's one way of getting people to smarten up! =

I know, right! Seriously, in my interview to become a teller that was the first thing they told me. The logic is that if I can't be responsible with my own money, how can I be trusted with anyone elses. They also did a full background check that would make the feds proud, verified my work history and all my references and pulled all 3 of my credit reports. I almost didn't get the job because my husbands score is questionable. They decided that his income negated his score, but warned me to be extremely careful about giving him access to my account because I would be accountable no matter what.