Overdraft protection options

If you’re looking for ways to tighten your budget or save a little extra each month, the first thing to do is look for money leaks. These are areas where you’re spending money unnecessarily, often without realizing it, and in ways that aren’t benefiting you.

One of the most common money leaks in any budget appears in the form of unnecessary fees, such as overdraft or returned item fees. Individually they may not seem like much, but they can add up quickly — and create gaping holes in your budget.

So how do you prevent unnecessary fees? Well, you’re off to a great start simply by being an OCCU member. As a credit union committed to low to no fees, we’ve reduced or eliminated more than 60% of account-related fees over the past three years.  

Another step you can take is to safeguard your checking account with overdraft protection to prevent overdrawing your account and having to pay expensive fees. Anytime make a purchase or payment and don’t have enough funds in your account to cover it, you run the risk of getting charged avoidable fees.

At OCCU, we understand that everyone has lean months sometimes. That’s why we offer multiple layers of overdraft protection for your checking account to help you avoid this common money leak.

First layer of protection: Ignite Savings account

The simplest way to avoid overdrawing is to open a savings account and link it to your checking account. We recommend Ignite Savings, a high-yield savings account that pays above-average interest on your balance. Your savings account acts as a buffer whenever you run out of money in your checking account, automatically transferring enough funds to cover your purchase and prevent your account from becoming overdrawn.

Second layer of protection: Personal line of credit

But what happens if you don’t have enough money in your savings account? Another option is to open an personal line of credit (PLOC). When a check or debit purchase is presented against your account and you don’t have enough money to cover the cost, your PLOC will automatically advance funds into your checking account in increments of $100 (up to your available limit). This allows your purchase to clear without incurring fees. You can pay back the loan when you have funds again, or set up an automatic transfer to cover your minimum monthly payment.

Last line of defense: Extended overdraft coverage

Extended overdraft* adds a final layer of protection to your checking account just in case you exhaust all the other options. Think of it as your last line of defense! Rather than return your purchase for insufficient funds, we could clear it and draw your checking account negative for the purchase amount, plus a fee. Your next deposit will go toward repaying the amount you owe, and you’ll have up to 30 days to bring your checking account back to a positive balance.

If your account has been open for at least 60 days and is in good standing with us, you may be eligible for extended overdraft protection. It’s not the same as a loan, but it can cover any checks, debit card purchases, ATM withdrawals, online or other electronic funds transfers, ACH debits and other payments or withdrawals, account service charges, pre-authorized drafts, and other items that may be posted to your account. One thing to be aware of is that all overdraft payments are at OCCU’s discretion, and we reserve the right not to pay if your account falls out of good standing.

Interested in learning more about extended overdraft or other protection options? Give us a call or speak with an OCCU branch team member to discuss how you can avoid returned item fees.

Insured by NCUA.

*There is a $9 extended overdraft insufficient funds fee which applies to overdrafts created by check, in-person withdrawal, ATM withdrawal, Bill Pay, preauthorized automatic debits or transfers, ACH, Point of Sale, or other electronic means. Extended overdraft occurs when payment of a withdrawal (all in person or electronic) or other transaction(s) brings the account to a negative available balance. Extended overdraft will be automatically refunded if they member has had no insufficient funds activity over the past 12 calendar months. Extended overdraft will be refunded if the account is brought to a positive available balance before the end of the day processing on the day the insufficient funds activity occurs. Available balance excludes the amount of recent deposits subject to hold and holds for pending debit card or other transactions. Refer to account agreement for further details.