8 Tips To Prevent Overdraft Fees

by Lauren Beichner

Marketing Specialist

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Did you know that over 39 million American adultsreported paying at least one overdraft fee within a 12-month period?

Let's be honest, everyone wants to avoid extra fees if they can. In this blog post we are going to dive into why these fees occur and how to prevent them.

Learn More About Overdraft Fees

How Do Overdraft Fees Occur?

An overdraft is what happens when you make an authorized transaction from your bank account in an amount that exceeds your account’s available balance. Overdraft fees can also occur with unauthorized transactions as well. 

8 Tips To Help Prevent Overdrafts

The best way to avoid overdraft fees is to be informed and to stay on top of your account activity. Here are eight helpful tips to keep in mind:

8 Steps To Help Prevent Overdraft Fees - Infographic

Explore Compare Coastal's Checking Account Options

1. Do Your Research

Research and compare checking account features such as minimum balance requirements, overdraft fees, and maintenance cost. Consider checking accounts that offer “low balance” alerts by email or text. 

2. Choose A Checking Account Or Prepaid Cards With Lower Risk

Consider choosing a checking account with lower overdraft fees or a prepaid card with lower fees. You can also choose a checking account that does not authorize overdrafts.

3. Keep Track Of Your Checking Account And Posting Order

Record your ATM withdrawals, deposits, and debit card transactions, including the times you expect transactions to post. This way you'll know how much money you can expect to be in your account to avoid an overdraft. 

4. Keep Track Of Your Automated Payments And Account Balance

When checking your balance, remember that some automatic payments and checks may not have cleared yet so keep this in mind when it comes to your account balance before you make any further purchases. 

5. Review Your Statements On A Regular Basis

Review your account statements monthly (or more) and check for any suspicious activity or unexpected charges.

6. Link Your Checking Account To A Savings Or Credit Card Account

If you link to another account, when you exceed your checking account balance, your bank or credit union will pull funds from your savings or credit card account to cover the transaction. However, the transfer from the linked account may incur a transfer fee, although this fee is typically lower than an overdraft fee.

7. Consider An Overdraft Line Of Credit

Your bank or credit union will pull funds from a line of credit to cover the transaction amount in excess of your account balance. The transfer may incur a fee as well.

8. Think Carefully Before You Opt-in To Your Bank Or Credit Union's Overdraft Service

By not opting in to your bank or credit union’s overdraft service, your financial institution will not charge you overdraft fees for ATM or one-time debit card purchases. Instead, ATM and one-time debit card purchases will be declined if there is not enough money in your account to cover the transaction.

Keep in mind that if you opt out of the overdraft service for ATM and one-time debit card purchases, the bank may still charge a fee if you overdraw your account because of recurring debit card payments (such as gym membership or streaming subscription service), online payments, checks, or ACH transfers.

Key Points

Overdraft fees are common, but remember, they are also avoidable! Here are a few key points to keep in mind: 

  • Minimize your risk
  • Evalute your options
  • Monitor your activity 

Want to learn more about overdraft fees? Check out our EverFi module to learn all there is to know about preventing overdraft fees.

Learn More About Overdraft Fees


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1. According to coastal.everfi-next.net