How to Avoid Overdraft Fees

One of the ways that banks are now making lots of money is by charging high overdraft fees. In fact, some banks will use questionably ethical techniques to ensure that you pay the highest amount of overdraft fees as possible. Here are some ways to avoid them.

	Know your account balance and get online banking. You are reading this article online, so you know how to use the Internet. Sign up for online banking with your bank, so you can check your balance regularly.
	Get on a written monthly budget where you designate where every dollar will go before you spend it. This way you make sure that you don't spend any more money than you have.
	Try to keep a minimum cushion in the account that you use for regular transactions. For example, you might want to mentally consider a $500 balance to be a "zero balance", so that you get into panic mode when your account gets close to $500. If your bank waives fees for maintaining a certain minimum balance, that would be a good amount to your as your mental "zero balance".
	Use cash. At the beginning of each month, after you have done your budget, check your bank account balance and then withdraw, in cash, all the money you will need for items that you buy at stores, such as food, clothing, entertainment, eating out, etc. Put the cash in envelopes and use only cash from those envelopes to buy the items. This way you will actually stick to your budget and not draw out more money than planned.
	Avoid writing checks when possible. Use automatic bill pay with reputable companies (at least as long as you are on good terms with the company.) If you have many outstanding checks it becomes confusing to determine how much money you have available.
	Have an emergency fund in place! Have $1000 if you still have consumer debt, and about 6 months of expenses once you get out of consumer debt