Posted on 09/09/2009 10:21:54 AM PDT by BGHater
When Peter Means returned to graduate school after a career as a civil servant, he turned to a debit card to help him spend his money more carefully.
So he was stunned when his bank charged him seven $34 fees to cover seven purchases when there was not enough cash in his account, notifying him only afterward. He paid $4.14 for a coffee at Starbucks — and a $34 fee. He got the $6.50 student discount at the movie theater — but no discount on the $34 fee. He paid $6.76 at Lowe’s for screws — and yet another $34 fee. All told, he owed $238 in extra charges for just a day’s worth of activity.
Mr. Means, who is 59 and lives in Colorado, figured employees at his bank, Wells Fargo, would show some mercy since each purchase was less than $12. In addition, a deposit from a few days earlier would have covered everything had it not taken days to clear. But they would not budge.
Banks and credit unions have long pitched debit cards as a convenient and prudent way to buy. But a growing number are now allowing consumers to exceed their balances — for a price.
Banks market it as overdraft protection, and the fees it generates have become an important source of income for the banking industry at a time of big losses in other operations. This year alone, banks are expected to bring in $27 billion by covering overdrafts on checking accounts, typically on debit card purchases or checks that exceed a customer’s balance.
In fact, banks now make more covering overdrafts than they do on penalty fees from credit cards.
(Excerpt) Read more at nytimes.com ...
I can check my account balance on my cell phone. Therefore, I never overspend with my debit card. People get whacked with overdraft charges because they are too stupid or irresponsible to keep track of their finances..
While I am against unnecessary regulation, banks have violated free-market principles by acting in collusion to raise these rates, and it’s time the government looked at abuses here.
How about just balancing your bank account to make sure you have the money to spend in the first place...seems to work for me.
again, this is really, really dumb on the part of the banks....one of the few things Obama could do to shore up his sagging pole numbers would be to take them all to the woodshed over fees....
I bet his evil bank offers transaction registers, probably even for free.
Time to put the George Washingtons in your wallet just to keep an eye on them! Everytime I pull one out I ask, ‘where do you think your going?’
Folks should be tired of being fleeced by the financial ‘non’ service industry by now.
Maybe this is an indication:
http://market-ticker.org/archives/1417-FLASH-Consumer-Credit-RECORD-Contraction.html
I’ve known this for years and been hit by it before (Bank of America). They order transactions largest to smallest to maximize the number of overdrafts, and they’ve also been known to play with transaction dates. Last time I got hit, I had a withdrawal on the 8th of a month, when I did have sufficient funds, post AFTER a withdrawal on the 10th, when I didn’t. Net result: I get whacked for an extra $35 stupidity tax.
Also, watch out if you have a checking account that charges any sort of monthly or annual fee. Yeah, you guessed it. One month the monthly fee posted drove me below zero balance...cha-ching, $35 more to B of A!
Oh, and B of A charges $35 *more* if you’re overdrawn more for five days or more.
}:-)4
with talk like that, you’ll never get a job in the gubermint.
It's even easier for the bank to check your balance and decline the charge. It's supposed to be a financial service, not a financial rape.
I use my AX card for everything. I only use my debit cards for ATM business.
The guy is nearly 60 years old and doesn’t understand how a checking account works. Sorry, but spend the money you have and don’t go to Starbucks if you don’t have cash.
Someone needs to tell this “career civil servant” that deficit spending only works in government, not in real life.
Having been a poor college student (in both senses) and being currently unemployed, I understand that there is only so much money to spend and when it’s gone, it’s gone.
Careful. Banks will credit a deposited check and it shows on-line as available, then in three days they find out the funds for that check are no good and they go back and charge you fees for being “overdrawn” even though on-line it showed you had an available balance.
Some banks report pending balance v. available balance. Other banks will clear a deposit then jerk it back to pending. I've seen it. It's not as simple as you make it sound, and people are being exploited despite keeping track of their balances.
The banks' behavior in many of these cases is dishonest.
My son was given a debit card when he opened up a new account when he first joined the Marines. He was 18 at the time. He was under the assumption that the debit card would act like a credit card, and if you tried to spend over your limit, the card would be rejected. He was in for a rude awakening when he had several $35 O.D. fees when the bank didn’t stop him from going over his limit, as he thought they would. Fortunately, my husband called his bank and raised hell and the bank reluctantly reversed most of the O.D.s. It was an eye-opener for my son and us as well.
Check out how often your credit card payment falls due on a weekend. If you pay automatically or with electronic payments and you use this due date, it won’t post until the following Monday and you will be charged a late fee. It is a complete rip off and I would switch to an honest bank that was fair and reasonable in their fees. I think I’ll check out a credit union to see if they are any better.
So this guy tried to game the system by withdrawing $350 from an account that clearly didn’t have the funds in it, and he’s all upset because the bank gamed him? I have very little sympathy.
I agree about the dishonesty. However, I can only speak from my own personal experience and I have never had an issue with this.
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