Some 10 million U.S. households don’t use any type of bank account for their money, according to the Federal Deposit Insurance Corporation. While some people who don’t use a bank say it’s because they don’t have enough money, a third of them say it’s because they have a fear of high or unpredictable account fees. They may be right to have that concern.
Banks made about $11.2 billion in fees from consumers’ overdraft and non-sufficient fund penalties in 2015, according to the Consumer Financial Protection Bureau.
And just 8% of account holders (typically those with low incomes, and who also may be young) carry overdrafts and pay about 75% of all overdraft fees, according to the CFPB.
More than two-thirds of people who consistently overdraft said they would prefer to just have their transaction declined instead, according to research from the Pew Charitable Trusts, a nonprofit based in Philadelphia. But they don’t realize they could have it that way now. Since 2010, banks have been required by law to let consumers opt in to allow their accounts to be overdrafted (if they don’t, their transactions would be declined); still, according to Pew, 52% of overdrafters don’t remember opting in. Thaddeus King, an officer for Pew’s consumer banking project, said it’s also possible to revoke permission for overdrafting, which is an option some might want to consider.
Read more: Americans spent $11 billion in bank fees in 2015 — here’s how to avoid them - MarketWatch
Banks made about $11.2 billion in fees from consumers’ overdraft and non-sufficient fund penalties in 2015, according to the Consumer Financial Protection Bureau.
And just 8% of account holders (typically those with low incomes, and who also may be young) carry overdrafts and pay about 75% of all overdraft fees, according to the CFPB.
More than two-thirds of people who consistently overdraft said they would prefer to just have their transaction declined instead, according to research from the Pew Charitable Trusts, a nonprofit based in Philadelphia. But they don’t realize they could have it that way now. Since 2010, banks have been required by law to let consumers opt in to allow their accounts to be overdrafted (if they don’t, their transactions would be declined); still, according to Pew, 52% of overdrafters don’t remember opting in. Thaddeus King, an officer for Pew’s consumer banking project, said it’s also possible to revoke permission for overdrafting, which is an option some might want to consider.
Read more: Americans spent $11 billion in bank fees in 2015 — here’s how to avoid them - MarketWatch
