A Guide to Chase Overdraft Protection

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New overdraft policies may have confused you lately. Each bank has a different set of policies, so it is important to know what your specific bank policies are. Last year, consumers had enough of overdraft fees. Combine the ability to overspend with a $34 fee, and you can end up with a loss of hundreds of dollars before your next paycheck.

In order to calm consumers, the Fed placed a ban on banks. Starting July 1st, banks will not be able to charge overdraft fees, unless a customer has opted in to the service. This comes as great news for the millions of customers who were stuck paying overdraft fees last year. The real problem came when customers were being charged a $34 fee for a $4 Frappuccino purchase.

Technology makes life a lot more convenient, but it also makes consumers lazy. The ability to bank online and on your cell phone, keeps consumers from keeping track of their spending. It's easy to check an online balance, or print a receipt out of an ATM, but those numbers are not always accurate. Pending transactions are not always extracted from remaining balances, so a consumer believes they have money to spend when they do not.

By keeping track of your purchases the old fashioned way, writing them down in a checkbook or budget sheet, consumers will always be aware of how much money they have in the bank. Otherwise, Chase does offer a few overdraft protection services. To comply with new Fed guidelines, Chase is elimination overdraft fees for debit transactions unless consumers opt in. For consumers who choose not to opt into the service, transactions will not be approved when you do not have sufficient funds.

Chase is also working to modify posts, so that they are able to recognize ATM withdrawals and debit transactions as they occur. This will provide consumers with a real-time remaining balance. Chase has also eliminated overdraft fees for customers who are less than $5 overdrawn. Lastly, instead of a maximum of six overdraft fees per day, the number is now down to three. This means that any one customer cannot be charged more than $102 in overdraft fees per day.

Furthermore, customers who wish to participate in overdraft protection can link their savings account to their checking account. When their balance hits zero, money will be transferred from the savings account to the checking account, in order to cover upcoming expenses. Another way to avoid overdraft fees is to simply stop spending when your balance falls below $100. Providing a cushion in any amount is a good way to avoid a negative balance.