WASHINGTON, Sept. 15 /PRNewswire-USNewswire/ -- Most bank customers don't pay overdraft fees, according to a new survey released by the American Bankers Association.   According to the survey, 77 percent of consumers said they did not pay any overdraft fees in the previous 12 months, while 21 percent said they paid one or more.  Two percent said they did not know whether they paid an overdraft fee.  The annual survey of 1,000 consumers was conducted for ABA by Ipsos-Reid, an independent market research firm, on August 14 and 15, 2010.

Of the 21 percent who said they did pay an overdraft fee in the previous twelve months, most said they paid only one or two. (see charts)

"The majority of consumers continue to avoid paying overdraft fees despite current economic conditions," said Nessa Feddis, ABA senior federal counsel and retail banking expert. "This is good news and a sign that most consumers are managing their personal finances well."

Additionally,  the majority of consumers who did pay an overdraft fee in the previous 12 months said they were glad the payment was covered (69%).  Twenty-nine percent said they wished the bank had refused the payment.

"Customers can avoid overdraft fees by keeping track of their balances, keeping extra money in their account as a pad, or by linking checking accounts to savings accounts, credit cards, or overdraft lines of credit," Feddis said.

ABA offers the following tips to help consumers avoid paying overdrawing their account:

1. Use direct deposit for your paycheck.  You will have access to your paycheck immediately.

2. Keep track of your balance and transactions and don't forget about automatic payments.  Track balances and transactions online, by phone, or at an ATM. Keep in mind that your balance may not reflect transactions you authorized that haven't reached or been processed by your bank.

3. Keep a "pad" or cushion of money in your checking account just to be safe.  

4. Link your checking account to a savings account or credit card.  These are usually less expensive alternatives, but remember:  credit cards have to be paid back on time and money is not automatically put back into your savings account when you deposit more money into your checking account.

5. Ask your bank for an overdraft line of credit that will cover you if you overdraw your account.  Just be sure to pay it back as soon as you get the bill.

6. Sign up for automatic notification when your balance drops below a certain level.  You may be able to get notified by text message or email.

7. Shop around. If your bank doesn't offer the services you would like, or charges too much for overdrafts, change banks.  Thousands of banks are competing for your business.

Click here to see charts.

METHODOLOGY:  For the survey, a nationally representative sample of 1,010 randomly-selected adults aged 18 and over residing in the U.S. was interviewed by telephone via Ipsos' U.S. Telephone Express omnibus.  With a sample of this size, the results are considered accurate within +/-3.1 percentage points, 19 times out of 20, of what they would have been had the entire population of adults in the U.S. been polled. The margin of error will be larger within regions and for other sub-groupings of the survey population. These data were weighted to ensure the sample's regional and age/gender composition reflects that of the actual U.S. population according to data from the U.S. Census Bureau.

SOURCE American Bankers Association

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