The cost to overdraw a bank account could drop to as little as $3 under a proposal announced by the White House, the latest effort by the Biden administration to combat fees it says pose an unnecessary burden on American consumers, particularly those living paycheck to paycheck.
The change could potentially eliminate billions of dollars in fee revenue for the nation’s biggest banks, which were gearing up for a battle even before Wednesday’s announcement. Exactly how much revenue depends on which version of the new regulation is adopted.
Banks charge a customer an overdraft fee if their bank account balance falls below zero. Overdraft started as a courtesy offered to some customers when paper checks used to take days to clear, but proliferated thanks to the growing popularity of debit cards.
So, my OD limit is $500, my fee is $35 regardless of how much I go over. Often in my poorest of months, I would wait till my account got very low, make sure there wasn’t any autopay or pending charges coming, then take out the $500 cash from an atm. I would use that cash to live on till my next paycheck, and deposit whatever funds were left over. My bank would reject any additional charges because its past the limit. This way I wouldn’t stack OD fees, and that’s less than 10%. In this late stage capitalist dystopia, I’d say that’s probably the best deal I could have asked for, outside of more money.
My problem when i was younger was i didn’t pay attention much to my bank account and would unknowingly overdraft. So i would get hit with 10 over draft fees out of nowhere for buying gas here, a pop there, a drink at a restaurant, just small charges that if i were smart didn’t need and would have just done what you did. It’s the un anticipated overdrafts that killed me when i was younger.