Overdraft protection

It’s not a junk fee, it just gets you out of sticky situations.


Overdraft FAQ


Common ways for overdraft protection programs to be structured:

Overdraft approvals

Checking account transactions may be approved over-and-above the available balance for certain types of items per the member’s request.

Overdraft line of credit

A loan is attached to your checking account to borrow from when your account is overdrawn.

Overdraft protection transfers

Another account (e.g. savings) is linked and funds are automatically transferred between the two accounts if you overdraft.



Talk to your credit union about its overdraft protection options to see what best suits your situation.


Overdrafts can happen to anyone.

Here are some tips to help avoid overdraft fees and stay informed about your account.


Set up low balance alerts.

Many credit unions offer an alert option so you’ll get a text, email or push notification if your account drops below a certain threshold. These alerts can help you be more mindful about your balance so that you can put more money into your account or spend less to avoid an overdraft.

Opt out of overdraft coverage.

If your financial provider doesn’t offer overdraft protection — or if its only options cost money — you may want to opt out of overdraft coverage, in which case your credit union will decline any transactions that would bring your account into the negative. Keep in mind that this option could put you in a sticky situation if you’re in an emergency and can’t make an important purchase because you don’t have overdraft coverage.

Consider getting a prepaid debit card.

Prepaid debit cards are similar to gift cards in that you can put a set amount of money on the card, and once you run out, you can load it with more money. The prepaid debit card can’t be overdrawn because there isn’t any additional money to draw from once its balance has been spent.

Link to another account of line of credit instead.

A link to another account or a line of credit may be a less expensive option than an overdraft. A single larger overdraft will result in just one fee, as opposed to multiple smaller overdrafts. Good account management is the best way to avoid overdrafts. For additional financial education resources, visit mymoney.gov.

Financial education

Most credit unions have certified financial counselors on staff. Ask your credit union to see how they can help you.

Credit unions often work with their financially distressed members to reduce the cost of overdraft fees, waive fees entirely and develop customized solutions to secure members’ financial well-being.