The changing rules for bank overdraft fees were big enough news that one of my banks gave me a call. The bank wanted to be sure I knew that starting July 1 for new accounts and by Aug. 15 for existing accounts, banks can no longer automatically charge overdraft fees. If I want that protection and the $35-40 charge with it for every incident, I would have to sign up for it. Without that protection when I use a debit card, the charge would simply be declined if there were insufficient funds in the account.
Now, since I am one of those old-fashioned people who doesn’t use an ATM card, I have no problem with having no overdraft protection. The new rules don’t apply to checks or recurring payments like automatic bill pay. I have my finger on the balance in my account. I don’t pull in for gas or make a purchase without knowing I have money to pay for it. Nevertheless, in the odd case I find myself in differing circumstances, I can opt in the program anytime. So, for now I’ll do without.
There is a problem for some, however. Funds could be available for one charge but not for a second one. If funds aren’t withdrawn before a second debit is requested, the second will be accepted. Unfortunately, real funds would have been spent twice. So, overdraft protection is not necessarily a bad thing.