Overdraft charges can be quickly mounted on your debit card and can appear any time as a serious financial problem or can ignite your existing financial problem. Not only that but also overdraft charges can put your military budget on strain. However, you can fight against this problem by avoiding overdraft charges even in the case if you overdraw your bank account accidentally or without knowing.

Opt In and Out Offers by Banks

In the year 2010, Bank of America started testing a pilot program that was about enabling consumers to get rid of expensive bank overdraft charges. In that program, bank sends you a text message in the event when you overdraw from your debit account. The text message was about giving a chance to the customers to choose a $35 overdraft charge and enable the payment to be transacted. The other option that you are provided with is to opt out hat $35 overdraft charge by depositing money into Bank of America ATM by 8.00 pm within the same day.

A Choice Given by Federal Reserve for Overdraft Fees

Federal Reserve rules state that banks and credit unions must achieve customer consent through their opt-in policy prior to charging any type of overdraft fee on their debt card. Consumer groups have always criticized banks overdraft coverage policies.

Federal Reserve Rules for Overdraft Charges

The Federal Reserve rules and regulations have not set any limit for how much banks can charge in terms of overdraft fees, home many times a consumer has to pay off an overdraft fees, and how overdraft fees are collected from consumers. The overdraft fee that is $35 is exclusive of overdrawn checks, as only debit cards are connected to the consumer’s account.

Problem Created by Fees for Military Personnel

Overdraft charges have always been a pressing issue, especially for military service members that are reliant on paycheck to paycheck, military families with increased debts, military students that are having loan payments. Jean Ann Fox, who is the director of the Consumer Federation of America, urges military service members to avoid opting-in because overdraft charges can accumulate faster.

Be Apprised of Opt-in and Out the Overdraft

You should be aware of how often your bank charges you an overdraft fee. For instance, Bank of America may impose overdraft charges to 4 transactions per day at $35 each transaction. The second overdraft fee is charged by Bank of America if the first fee and overdraft is not paid down in few days. Things can go more complex as the overdraft fees are mounted. You should be well apprised of how checks and other transactions are paid off from your bank account. You should also be attentive towards your checks and balances and avoid withdrawing more than you have in your bank account.