The next step you should take is to manually balance your checking account. This will help you figure out how much money you'll need to bring your account back into the positive immediately.
Don't forget to include any returned check or overdraft fees, or charges or checks that haven't hit your account yet. You can balance your account in a couple of ways. You can log into your account online to see what you've spent, the checks you've written, the direct deposits you've set up, and any outstanding payments you have.
Balancing your account is more than just checking your balance each day. If you're not regularly balancing your account, you should start doing so now, especially if you are having issues with an overdrawn account. Start by recording the transactions you make each day and marking off when they clear your account. It's important to bring your account balance back into the positive as soon as possible. If it's overdrawn by more than a few days, then your bank may start charging extended overdraft fees on top of what you already owe—and this can quickly snowball.
Policies vary among financial institutions, but in many cases, banks will close your account if it's overdrawn for an extended period of time. If you're using cash to pay for your purchases, deposit some into your checking account each pay period to help correct the deficit.
Consider selling items you do not need or want to help close the gap, as well. If possible, you may consider borrowing the money from a friend or family member to bring your account into the positive as quickly as possible and avoid more overdraft fees.
Many banks will waive the first overdraft or returned check fee if you call their customer service line, especially if it's the first fee incurred by a new account or the first fee incurred by any account in a new calendar year.
However, keep in mind that banks are not obligated to refund any fees—and you'll typically get better results if you are polite and ask nicely.
If you simply owe too much, or you don't think you'll be able to fix your overdrawn account, you should speak with your bank and set up a plan that will allow you to fix the problem without being reported to ChexSystems. Either way, you'll still be responsible for paying back the money you owe. Direct, polite communication with your bank is the best way to deal with the problem and find a possible solution.
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We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. Related Articles. Partner Links. A checking account is a highly liquid deposit account held at a financial institution that allows deposits and withdrawals.
How Overdraft Provides Protection An overdraft occurs when there isn't enough money in an account for a transaction or withdrawal, but the bank covers the transaction anyway.
Read about NSF fees and how to avoid them. Linked Savings Account A linked savings account is a savings account that is connected to another type of account like a checking account.
Why Overdraft Protection Matters Overdraft protection is a fund transfer or loan that banks offer to customers to cover checks or debits larger than their account balances, so as to avoid nonsufficient funds fees. Bounced Checks Explained A bounced check is slang for a check that cannot be processed because the writer has insufficient funds.
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Another way of saying this is an overdraft happens when a transaction exceeds your available balance. We make this decision at our discretion based on several factors such as the transaction amount and your account history. This is the amount of money in your account that is available to spend, withdraw or cover transactions. Your available balance is updated throughout the day based on your account's activity. Your available balance incorporates any holds on your account, such as holds for debit card transactions we've authorized, and deposit holds.
Keep in mind that there are a few things that are not included in your available balance such as checks you've written that we haven't received yet and upcoming automatic payments. You'll also want to account for transactions where the final amount may differ from the amount that was originally authorized, such as when a tip is added to a restaurant charge. A one-time debit card purchase such as groceries or a cup of coffee, the transaction will be declined with no fee.
A recurring debit card payment such as for a gym membership or subscription service, we may allow the payment to go through, overdrawing your account, and may charge a fee. If we don't allow the payment to go through, we won't charge a fee.
An ATM withdrawal, we may give you the opportunity to overdraw your account for that specific withdrawal if you agree to our overdraft practices and fee at the ATM. If you cancel the withdrawal, we won't charge a fee.
Check, Bill Pay payment or a scheduled electronic payment using your routing and account number, we may allow the payment to go through, overdrawing your account, and may charge a fee. If we don't allow the payment to go through and return it unpaid, we may charge a fee.
The best way to avoid overdrafts is to always make sure you have enough money to cover your purchases and upcoming payments. We have some great tools that can help you monitor your account balance and activity:. There are no overdraft or non-sufficient funds fees with this account. Checking accounts aren't designed to let you use more money than you have, though. When that happens, your bank can charge you fees , make you pay it back and even close your account.
When your account gets to a negative balance, your bank will probably charge you an overdraft fee that makes your account even more negative. Your bank can also close your account if it's negative for too long, or if you repeatedly go negative.
Be sure to check your balance regularly. An overdraft happens when you take more money out of your checking account than you have in it. This can happen because the transactions you do don't always immediately get reflected on your account, so it's possible that you could keep spending without realizing that you've taken too much out of the account. At times, your bank will know that you've spent too much but will still approve the charge to save you from being declined.
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