I recently saw an television ad for a bank that offers overdraft notification so that you can choose how to fund the mistake. My first thought, “If the person was managing their money properly, they wouldn’t need this option.” And then I got frustrated.
A bank wouldn’t create a service like that or spend money to run television ads if there wasn’t a market, if there wasn’t a lot of people bouncing checks (paper or digital). You know what financial institutions are actually saying? “Hey you people who don’t know how to manage your personal finances, come to us so that we earn money off your inability to plan.”
Is it possible to find yourself in a situation where a bounced check is possible, even with good planning? Yes. There are two reasons for bouncing a check and even then, you can limit the chances of this happening.
- A deposit didn’t go through as expected and the checks written against the deposit were made vulnerable.
- An automatic bill pay service pulled an amount higher than budgeted thus causing other transactions to go unpaid.
If you want to know what it takes to prevent overdrafts and all the fees that go with the process, you need to learn how to budget in such a way that you will see the overdraft coming and thus prevent it.
I have shared a financial management process, for free, that has worked for me and others for decades. It’s not an app but you can work the process online. Please take a look at my online tutorial called Financial Headaches: A Series on Personal Finance Management. There’s something to say about manually managing your money versus having an app tell you what you can spend, other to learn later that the app was wrong.