Banks & Overdraft Protection

[laz98]

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?

[newstart2010]

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.

[MidnightVoice]

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!!!)

[demi]

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.

[laz98]

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@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.

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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?

[haulingthescoreup]

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.

[bicknar]

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

[Anonymous]

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@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?

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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. 

[laz98]

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@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. 

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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.

[laz98]

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@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. 

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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