An unexpected expense can easily push your account balance into the red, and the last thing you want is an overdraft fee making a tight situation worse. These fees can add up quickly, turning a small shortfall into a significant expense.
Luckily, a growing number of financial institutions now offer accounts designed to protect you from these charges.
Ally Bank
Ally Bank’s Spending Account is a strong contender for those looking to avoid overdraft charges. It has no monthly maintenance fees or overdraft fees. For added peace of mind, Ally offers an optional service called CoverDraft.
This feature provides a temporary safety net of up to $250 for eligible customers who have qualifying direct deposits. Additionally, you can set up free overdraft protection transfers from a linked Ally savings or money market account, giving you multiple ways to prevent a negative balance.
Discover Bank
Discover Bank’s Cashback Debit account is another top choice among banks with no overdraft fees. This account completely does away with overdraft fees. You can opt into their free overdraft protection service, which will automatically transfer funds from a linked Discover savings account to cover a shortfall.
This is a seamless way to avoid declined transactions without incurring any penalties. Without this protection enabled, any transaction that would overdraw your account is simply declined, so you never have to worry about unexpected charges.
SoFi
SoFi Checking and Savings simplifies your finances by combining both account types and eliminating overdraft fees. The account offers fee-free overdraft protection for all members. For those who qualify with direct deposits, SoFi provides Overdraft Coverage of up to $50.
This means if you accidentally spend a little more than you have, SoFi may cover the transaction up to that limit without charging you a fee. It’s a useful feature that provides flexibility for small miscalculations. Always check with SoFi directly to confirm the most current terms for eligibility.
Chime
Chime’s Checking Account offers an innovative feature called SpotMe, designed to help members avoid overdrafts. Eligible members can enroll to get coverage for overdrafts up to $200 without any fees.
To qualify, you typically need to receive a qualifying direct deposit of $200 or more each month. SpotMe gives you a cushion for those times when your balance is lower than you thought, preventing declined purchases and helping you manage your money with more confidence.
Axos Bank
With the Rewards Checking account from Axos Bank, you don’t have to worry about overdraft fees. The bank offers free overdraft protection by linking your checking account to another Axos account, like a savings or money market account.
If you make a purchase that exceeds your checking balance, funds will be automatically transferred to cover it. This straightforward protection helps ensure your transactions go through smoothly without any surprise costs.
Alliant Credit Union
Alliant Credit Union’s High-Rate Checking account also provides a fee-free solution to overdrafts. As a member, you can set up complimentary overdraft protection from a linked Alliant savings account. If your checking account balance runs low, Alliant will transfer the necessary funds from your savings to cover the transaction.
This service helps you avoid the stress and cost of an overdrawn account while you continue to earn competitive interest rates on your balance.
