Learning Resources

An overdraft occurs when money is withdrawn from a bank account and the available balance goes below zero. For example, when you write a check or swipe your debit card but do not have enough money in your checking account to completely fund the transaction. In this situation, the account is said to be “overdrawn” and certain fees apply.

When looking at your account balance, it’s important to understand the difference between the current and available balance. The available balance includes any deposits, withdrawals, and transfers that have already posted to the account and are available for immediate use.

Another important consideration is the posting order of transactions. Deposits are generally posted to your account when they are received, but a hold is often placed on a deposited check, meaning that the full amount may not be available to you immediately. Debits – from checks, ACH payments, and debit card transactions – often vary in how and when that they are presented by merchants.

Overdraft protection is a way to fund an account that has been overdrawn using funds from another account, such as a savings, secondary checking, money market, or line of credit. In an overdraft situation, certain fees and limits apply. Customers have the option to opt in or out of overdraft protection at any time. Without this service, transactions would be declined possibly causing embarrassment and inconvenience.

Follow these useful tips to avoid overdraft situations, leaving more money for you to enjoy:

• Track your transactions – Take advantage of Allegacy’s digital tools to keep regular tabs on your account balances, spot a low balance, or identify a transaction that has not yet posted to your account.
• Set account alerts – Enabling push notifications is an easy way to stay abreast of your account activity. Choose from specific balance thresholds, large deposits and withdrawals, or a weekly balance update. Payment reminders are another great tool for keeping track of your bills and avoiding overdraft.
• Adjust payment dates – Contact your lenders and service providers to request a change in payment dates to make it easier for you to make ends meet without overdrawing your account. Just be aware that it may take one billing cycle to implement the change.
• Utilize digital payments and transfers – If posting order is a concern, opt for digital payments and transfers as they will typically post sooner than checks. Both WebBanking and the Mobile app will allow you to schedule and edit payments and transfers.
• Create some margin – While it is not always possible, try to keep a minimum balance in your account at all times, such as $100. Consider this your cushion should some of your transactions clear before you have a chance to make a deposit. Set up a low balance alert to make sure you maintain your designated margin.
• Be an informed consumer – Do your homework to become familiar with Allegacy’s account rules and associated fees. Reach out to one of our customer service representatives with clarifying questions.

• Enrich Financial Wellness – Explore Enrich content related to effective account management, budgeting, and minimizing fees. Take advantage of one-time fee waiver program by completing the Enrich Budgeting course.
• Account Alerts – Enable push notifications, like a weekly balance update or large withdrawal alert, to stay abreast of account balances and avoid overdraft
• Overdraft Video – Watch this Overdraft video to learn about the current and available balance, posting order, and tips for avoiding overdraft situations