I tended to get MORE overdrafts when I was managing money well. During those periods when I didn't get overdrafts, it was because I'd have $10,000+ in my checking account. I could manage it horribly and still not get overdrafted. Then, when I started funneling money into investments and kept my checking down around $2,000, I started getting overdrafts. That was just the next step in my maturity process.

No, of course not! I have overdraft because of a bad experience. I have my paycheck automatically dropped in. This is every other thursday. When I get my bills, I immediatly write a check out for the ammount due, then put it in the right envelopes, writing over the area where the stamp goes the date when they need to be mailed out. So imagine my shock to discover a full week later that my paycheck was put into a different account. Of course this was when half the bills were due. Though they were responsible (admitted to it) I was nervous enough to never ever wanna do that again. So added an overdraft for a buffer of protection, just in case. Never had that happen since, but sure don't like the feeling.

Kathyfrances,

I had the same thing happen to me that happened to your Mom. Waaay back when banks were just beginning to use ATMs I went to take $20 out of my account, hit the zero too many times and took out $200. The bank was closed and by the time I got the money redeposited it was just enough to mess things up. Haven't had an overdraft since; it's way too expensive!

To me though having overdraft doesn't mean you're a bad money manager any more then having car insurance means you're a bad driver. Even the best drivers who strive to avoid accidents can have things go wrong every once in a while and when they do it's smart to be covered.

Leo

I would say if it happens once or twice no. Things happen it has happened to me before. However if this is a constant occurance then I would have to say yes they are bad money managers.

I agree. I've had to use my overdraft account before (it's overdraft protection, so there are no fees, which is nice). I think it's good for unexpected expenses. A few weeks ago, Jason and I had to write a check as ernest money for the house we're buying. That was a chunk of money that we ended up paying a lot sooner than we thought we'd have to. So, it took some out of my overdraft. ::shrugs::

Actually, a month ago I noticed that I was using overdraft much more frequently than I liked. Since then, I've gotten a lot better about keeping track of my money, and it doesn't happen anymore!

'People with overdrafts are bad money managers'
Do you agree?

I would say if it happens once or twice no. Things happen it has happened to me before. However if this is a constant occurance then I would have to say yes they are bad money managers.

i got into doing overdraft right before i read this post. at first i was mad that someone would say that this was wrong, but God has been convicting me of this. it's like on one hand i needed the money so it seemed ok, but than i thought about it and i can't get past the fact that i am placing myself in more of a hole. cause i have to pay that money back on top of overdraft fees, and won't see any of my pay check until it gets paid. i was just robbing peter to pay paul. it's just too much hassle to use that given privlege. i just gonna trust in the Lord like i should of at the beginning, to provide all my needs according to His riches in glory by Christ Jesus. i will leave you with this <<<<<JUST TRUST IN THE LORD>>>>>

haha... i'm not sure that confession is necessary, since this isn't an issue of sin in the "thou shalt not" sense. But as long as we're sharing, i've overdrafted in the past as well. I did a few times before I was married, and only once after I was married. When two people are trying to keep track of the checkbook balance at once, sometimes we forget to tell one another that we're buying something. so... that lends to some mix-ups in the budget-balancing act, and that caused the overdraft.

but my wife and i worked it out, and now she budgets the balance, and i don't get any money. haha...

I have considered that as well- I just don't like dealing with money-orders!

Confession is good for the soul and I am guilty of not being a good steward and as a result overdrafts. My solution was to close my checking account and deal with cash only. It has really taught me a good lesson.....

That's true... I failed to consider the situation where a business might be responsible for a customer's overdraft. I guess a person would be exempt from the "bad money manager" label in that situation.

Not that it's really a label. If i did overdraft something by 3 cents, I managed my money poorly. Whether by accident or by ignorance, if i truly overdrafted, i did manage the money poorly.

But again - it's not a clinical diagnosis. if you broke it, fix it.

It's interesting to see how Check 21 (effective 10/28/04) is affecting banking services. It was touted as an easier way for banks to speed up business by cutting down on the paper trail, but the actual effect it's had on the public is to make deductions from one's account almost instantaneous. At my husband's job, they were counseled to assume that the moment they submit a check to a vendor, the money has been deducted from their account. Check 21 affects the people who write checks before payday, thinking that "the money will be in the bank tomorrow." With this new procedure, that check has the potential to bounce because it could be deducted the day it's written, not a day or two later

I found out about this REAL fast!
I work for a VERY small non-profit org.(at this point I am the only employee). Because of some problems in the past with the foundation's account, my Board director deposits my pay into my account (but not 'direct deposit'). My last deposit was made on a Fri., the bank (theirs) shows that there was money in the account, my bank processes it with 'Check 21' on Fri., determines there is NOT funds in the debiting account, and places a 15 day hold- ON MY PAYCHECK! The Foundation's bank recieves check for processing on Mon., and pays it without ado. Their records show this as the ONLY presentation of the check, with no problems attached. MY bank, on the other hand, continues to hold the funds, even when contacted that the check has already been paid, my 'auto-pays' get OD-charges, and I accrue late charges on my rent. So, who is at fault here? Me? The foundation? The 'System'? It all depends which side of the line you are standing on. From my position, it looks like something that person-to-person contact, human interaction, could have avoided. In the 7 years that I worked in banking (granted, quite a few years ago) we would have made phone contact, listened, and handled the situation accordingly. It seems that, in the pursuit of 'quicker, easier', we lose one of the most essential, basic aspects of our creation- relationship. As with auto-checkouts, automated phone services, and so many other 'new tech.' advances, when the human-element is removed, so is the ability to interact in the manner which God has created us to. It is very sad.

Am I a bad money manager? Well, I admit, I am not the best. Living on a VERY limited income, my account frequently is down to pennies (literally) at the end of the month. But I work hard at not being a 'Bad' money manager. You would not know this by looking at my account.

I apoligize, I have gone off topic and ran on and on to boot. But thanks for listening. I will try not to do it again. YSIC, Pam

Are people with overdrafts bad money managers? It's not fair to make a judgment, overdrafts can happen to anyone! Sometimes things happen, for a variety of reasons, often due to extenuating circumstances beyond our control. I have overdraft protection at my bank, though I've never had to use it. But that fact alone doesn't make make a "good" money manager, just as the lack of a speeding ticket doesn't make me a good driver!

One time my mom wrote a check to Sears for a payment of $50. When the cashier ran it through the cash register, she hit $500. The bank cashed it for the amount electronically placed on the back of the check, rather than for the amount my mom had written it for....checks bounced, deposits were taken to cover bounced check fees, more checks bounced before she got a statement from the bank. It turned into a huge mess, with Sears finally making restitution. If one were to judge the situation simply by appearances, my mom would have looked like an incredibly bad money manager...when the truth is so far from that, it's laughable.

It's interesting to see how Check 21 (effective 10/28/04) is affecting banking services. It was touted as an easier way for banks to speed up business by cutting down on the paper trail, but the actual effect it's had on the public is to make deductions from one's account almost instantaneous. At my husband's job, they were counseled to assume that the moment they submit a check to a vendor, the money has been deducted from their account. Check 21 affects the people who write checks before payday, thinking that "the money will be in the bank tomorrow." With this new procedure, that check has the potential to bounce because it could be deducted the day it's written, not a day or two later.
kathyfrances

I once had a bunch of overdrafts, but that was because of someones check bouncing for me.

The most embarassing one I take full responsibility for was overdrafting by 61 cents. Cost me 33 bucks in fees.

I don't think i'm bad with money, but living from paycheck to paycheck has it's perils.

generally speaking, yes. if you've overdrafted, that's the same thing as bouncing a check. it means you're spending more money than you actually have, and that is an example of bad money management.

if you're the one overdrafting your account, you might want to go over your finances and see what's causing you to go over, and make adjustments. being a "bad money manager" isn't a clinical diagnosis. You can go from being a bad money manager to a good money manager. It just requires a little work, and some examination of where your money is going.

*cough*

*has had many overdrafts*

Possibly...