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Look Who’s Driving Up Overdraft Fees Now

Overdraft fees are up again, and the culprit isn’t who you’d think.

The median national overdraft charge is now $30 a transaction, up from $29 in 2012, according to a new study by Moebs Services, an economic research firm in Lake Bluff, Ill.

But the banks haven’t changed the median overdraft fee on their checking accounts. They’ve been stuck at $30 per transaction since 2010.

No, it’s credit unions that have been raising their fees, which were $25 in 2011 and now stand at $28. That’s what pushed up the national median.

Also, according to the study, it’s the size of the financial institution that counts — bank or credit union.

Banks with more than $25 billion in deposits had the highest overdraft fees, clocking in at $35, while small banks and credit unions with less than $100 million in deposits had the lowest fees of $25.

We must admit that we’re disappointed to see credit unions — the financial industry’s good guys — boosting their fees like this.

It’s just another reason why everyone should refuse to be lured into overdraft protection, wherever you have your checking account.

In 2010, the Federal Reserve stopped banks from automatically enrolling customers for this service and said customers had to be asked to opt in.

Why anyone would volunteer to pay their bank a fee for not having enough money to cover lunch at Burger King or a Starbucks coffee is beyond us.

It’s better to endure the slight embarrassment of having your debit card declined than fork over $30 every time you try to spend more than you have in your checking account (which can happen multiple times in one day before you realize you’re short).

The Consumer Financial Protection Bureau recently found that those who spurned overdraft protection paid an average of $28 in non-sufficient funds fees in 2011.

Those who opted in paid an average of $196.

Who would you rather be?

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