Overdraft Protection

We live in a fast paced world. Many times we end up our days counting the things we didn't get done. One of those things could be the accounting of our finances. So we choose taking Rudy to daycare and we will enter the check we just wrote for the dry cleaning later. Oh, we always remember later. We remember when we get the Overdraft Notice. The ideal situation is to write in each check and debit in as we do them, but we don't live in an ideal world. So there is Overdraft Protection. It comes in many forms. It could be an automatic transfer from a savings account, a special line of credit or a charge to your credit card. These could all have charges connected with them, but generally not as expensive as the Overdraft Charge without any protection. Overdraft Charges could be up to $36.00 per item. That can get very expensive. A line of credit could have a high rate on it, but 18% on $100 is only $19 if you carried the balance for an entire year. The bank will, of course, make you pay it back sooner than that. The overdraft from a savings account will, most likely, have a per transfer fee attached to it. The credit card will also have interest charges as well. Some banks will charge an annual fee for the privledge of having Overdraft Protection, but in the long run you will be better off having it available. I once had a customer that had an overdraft that was covered by overdraft protection. She claimed she had never signed up for it and wanted it cancelled, because she doesn't overdraft. She accepted the lower charge, though.