Have you been caught up in the nationwide frustration over outrageous overdraft fees? Or, maybe you have just noticed one-too-many fees on your bank statement and are getting more than a little fed up.

Either way, you may feel that it is time to switch to a low overdraft fee bank. And that makes good sense. After all, the range of fees that banks can charge is rather wide, from $10 to $35. Why not find a bank that charges less in fees for each instance of an overdraft?

Bank Fees Have Gotten Out of Control

There is no question that fees have gotten out of control. Banks collectively earn over $29 billion per year off of their customers in overdraft fees in the United States alone. Whereas these fees used to be merely in place to penalize customers for overdrawing their accounts on occasion, the fees have turned into big business for banks.

In fact, these fees are now regarded as an official profit center for banks. That means that banks actually count on these fees as a way to make significant amounts of income. So, how did the fee situation get to this point?

How Overdraft Policies are Stacked Against the Customer

It all comes back to something called overdraft protection programs. Starting about 10 years ago, these programs became increasingly popular with banks. The programs are designed to protect customers from writing bad checks or making charges on their debit or credit cards that are not properly backed up by a checking account balance.

However, some believe that the programs are misleading (and costly) to customers in two ways:

a. the programs have traditionally been opt-out in nature, which means customers were automatically enrolled in the programs upon checking account sign up (often with very little explanation about how the programs actually work).

b. with overdraft protection, many customers do not realize that they can make an unlimited number of debit card charges even when their accounts have a zero balance. This means that one day of shopping could cause someone to unknowingly incur $100 or more in fees.

Low Overdraft Fees Banks and Other Alternatives

Tired of paying outrageous bank fees? Here are 3 insights on alternative to paying high overdraft fees:

1. Some banks and credit unions charge relatively low overdraft fees: You can search for a bank or credit union that still charges these fees but that charges less per transaction (say, $20 instead of $30 per overdraft).

2. Even lower fees can cost you $100 or more a month in fees: Still, if you are someone who gets dinged with these fees a few times each month, even the lower fees could cost you well over $100/month.

3. Another alternative is to switch to a no-overdraft fee bank: There are many well-established banks that promise to never charge you a penny in this type of bank fees – even if you overdraw your account. Imagine having a checking account at a bank like this: you would never pay a penny in overdraft fees again.

If you are tired of paying high overdraft fees, try these alternatives and start saving money right away.

Author Bio: Find a list of no-overdraft-fee banks in your area at: Banks Without Overdraft Fees.

Category: Finances
Keywords: Limit On Fees a Bank May Charge ,Low Overdraft Fees Banks,Alternatives to Paying Overdraft Fees