Sign up for your Overdraft Line of Credit!
An Overdraft Line of Credit (OLOC) works similar to a credit card except that you don’t have to worry about the plastic. This line of credit will automatically go into use only when you need it. Any time that your account at Class Act receives a debit that is more than the available balance, you will automatically begin to pull funds from your OLOC instead of receiving overdraft fees. Then you just want to make sure that you pay off your OLOC when it comes due. With a rate of just 15% APY*, this could save you hundreds in a month!
See the example below:
Your available balance is $30. You go to the mall and buy the following: Shirt and pants from Macy’s ($60), Shoes from Journey’s ($50), lunch in the cafeteria ($35), and you finish the day with some hand creme ($40) from one of those sales folks that convinced you it would change your life.
Your account at the end of the day WITHOUT OLOC:
Total purchases: $185
Total Fees: $132 (4 x $33 overdraft fee)
Starting Balance: $30
Available balance: -$287 ($30 – $132 – $185)
Total interest and Fees: $132.00
Your account at the end of the day WITH OLOC:
Total purchases: $185
Total Fees: $0
Starting Balance: $30
Available balance: $0
OLOC balance: $155 ($185 – $30)
Interest approx. (if paid in 30 days): $1.94 ($155*0.15/12)
Total Interest and Fees: $1.94
Total Savings: $130.06
Other ways to avoid fees:
- Keep funds in your savings and set up auto transfer – if you set this up, funds will transfer from your savings account to your checking account when you run out of money for just $3 instead of $33.
- Use Courtesy Pay – when this is set up, you will still pay a fee of $33 but Class Act will cover the cost of your charge. So if you wrote a check that bounces, your check will still go through even if you don’t have the funds to cover it.
- Opt-in – Courtesy Pay normally just works for checks and ACH’s but you can Opt In your debit card too so that those purchases are covered. This way, if you are at the checkout line in the grocery store and you don’t have the funds for your purchase, your card won’t get declined. You’ll still pay the $33 fee but the funds will be covered by Class Act. Be careful though, the fee is always $33 no matter the purchase. So if you go and buy a soda for a dollar, if it brings you negative, you will still have to pay the $33 fee with it. That’s an expensive soda!
- Come to a free budgeting class offered by Class Act! Learn how to manage your money so that you don’t run into issues in the future. Click here to see all of the upcoming financial workshops.
Click here to sign into your account and sign up for your Overdraft Line of Credit!
*APR=Annual Percentage Rate. Rate subject to change at any time.
