Center for American Progress

Avoiding Costly Overdrafts: Think Twice Before You Swipe Your Debit Card
Article

Avoiding Costly Overdrafts: Think Twice Before You Swipe Your Debit Card

Even checking accounts—probably the most basic account in banking—contain a plethora of hidden traps these days and practice a type of “gotcha capitalism” that will get you if you don’t take a few steps to avoid the most common pitfalls.

Do you make the occasional math error? If you do with your debit card, you may pay $30 or more.

Even checking accounts—probably the most basic account in banking—contain a plethora of hidden traps these days and practice a type of “gotcha capitalism” that will get you if you don’t take a few steps to avoid the most common pitfalls.

Overdraft fees are the most common—and irritating—fees associated with checking accounts. The Consumer Federation of America’s survey of “courtesy” overdraft protection systems found that in 2005, banks charged an average of $28.57 to pay a transaction that overdrew a checking account. One bank in the survey charged $36.00 for its overdraft fee. And these fees have been on the rise since 2002.

Read more here.

The positions of American Progress, and our policy experts, are independent, and the findings and conclusions presented are those of American Progress alone. A full list of supporters is available here. American Progress would like to acknowledge the many generous supporters who make our work possible.