I heard this from a friend, his true personal experience. Banks suck! Over the July 4th weekend, he realized he had some major purchase to do, so he went online to check and make sure he has enough funds in the account. During the period, he also withdraw cash once and find there's still money left. To make sure, he transferred some small amount from saving to checking. And he made some more small transactions with his check card. This week however, he found out he was charged with a series of overdraft fees. When he called the bank, they told him that online accounting wasn't accurate and was not to based on, especially during the weekend in which the bank didn't clear the transaction. Same goes for ATM! The only way to make sure is to have a check register. What happened was that some transactions wasn't cleared when he checked the online account. And because of the charge of first series of overdraft fees (over transactions like a cup of coffee etc), his account actually went negative even though he made his transfer from saving. And the bank insisted there's nothing the bank can do because it was not due to "bank error". They only offered to have his checking account linking with saving, which was standard for newer accounts but was not offered on his because he had an old account. And it "graciously" forgave 3 of the overdraft. Overall though, he was still hit with a total of 11 overdraft fees that amounts to close to $400, mostly over very small purchased!! The banks suck and are sucking blood. Is there anything he can do (maybe legally?) over this situation?
My jackass answer would be: he could keep track of each expenditure from now on, because your available balance doesn't necessarily calculate in purchases that are pending.
Just as Bobrek said, it's the correct answer. Sometimes the truth hurts. Why is it the bank's fault that the person didn't keep up with his own account? You always always always make sure that checks have cleared when figuring your balance.
hmm, maybe Banks singing the virtue of online banking and never serious educate its customers the "inaccuracy" of it before things like this happens has something to do with why he was bummed? Personally I wasn't aware all this before he told me of the story.
And the thing is, if the bank truly recorded the transaction when it was cleared- meaning after the weekend- he wouldn't be hit with more overdraft fees. But no, the bank retro fit the transaction to that date when the transaction was made and thus the account was over limit although not reflected.
Then maybe they should change their explanation of Available Balance. As per PNC Bank (my bank): Available: This is the Available Balance. The Dollar Amount available for Immediate withdrawal from a checking, savings, or money market account. Maybe other banks are different, but to me, that sounds like money that I can take out immediately. The ledger Balance on the other hand, doesnt take into account that purchases that are pending.
Yeah, that sucks, but it still doesn't mean that your friend shouldn't keep up with his balance on his own.
My favorite is the amount of time it takes my bank (Wamu) to complete an on-line bill pay. You'd think it'd be near automatic as in a wire transfer and not take upwards of 2-4 days. I called and asked them about it, and I think they're actually cutting checks to the intended payees. At least they've improved their accuracy in predicting when things will get posted. There's nothing worse than paying your bill on-line (and seemingly on-time a day or two before the due date) and then finding out next month that you were late on the payment by a day.
I asked my bank about this and was told that wa because of something on the recipient side, not with them. Once I found that out, I just write the checks myself. Most of my bills are sent ACH debit I think.
The reason could be several that have nothing to do with the bank. If you have written any checks, the recipient may not have processed the checks yet - especially if its a large corporation, it may take a few days after they receive the check to actually process it. In which case it is your fault that you don't keep up with your register. Even with debit cards, I've noticed that sometimes it has been up to 4 days before it shows up on my bank account. This is because although the vendor may run your card at your POS, they actually may not send the charges in until late that night or a day or two later. This is why when you add a tip to a debit purchase, the original purchase price will sometimes show up on your bank account, and then a couple of days later the debit charge will have changed to reflect your tip. Again, ALWAYS keep a check register...even if you never write checks...keep detailed track of your spending.
Assume I open a bank account with $2000. I write 10 $150 checks on Tuesday. On Wednesday, I check my balance and it shows $2000 because none of the checks have cleared. On Saturday I check my balance and it shows $1250 (5 of the checks have cleared). That does not mean I have $1250 to spend. In essence there is only $500 in my account because I still have $750 worth of checks outstanding. It is my responsibility to know that. The bank does not know I have 5 checks still out there. In addition, check card activity may also not post immediately.
Agreed...Our stores send the transactions to settlement each night, by 2 AM. If there is an issue, and the file misses the 2AM deadline, it will not be funded until the next day, which is 2 days after the transaction. That is not the banks fault, its the merchant who sends the settlement information to them.
A major reason why my wife and I have separate checking accounts is because she refuses to write any transactions down while I not only keep a running check register but also a detailed Excel spreadsheet (I also keep track of our joint account that we use only to pay the household bills like the mortgage, utilities, etc).
