We’ve all been there. You’re looking at your account balance and you’re baffled as to how it could’ve gone below zero, especially if you’re absolutely sure there’s nothing you’ve done to cause it.
However, there are many things we overlook, including the numerous monthly subscriptions we pay, and this is particularly true for those we actually don’t even use but never got around to unsubscribing from.
However, this shouldn’t be the reason to raise an alarm, as there’s more than one solution to this fairly common issue, and you’ve got many ways to get yourself back on track.
Of course, it’s highly advised not to even let your account get to this less-than-favorable balance amount, but things can get out of hand sometimes, and it is up to you to learn how to deal with them.
We’ll go over some things you can do to get yourself out of this pickle as well as some things to keep in mind if you want to avoid this situation entirely, so keep reading and do yourself and your finances a favor.
The initial course of action
From the moment you notice that your account balance has hit zero or even gone negative, you should examine the situation and try to pin down what exactly could’ve caused it.
Contact your bank about any overdraft fees they may have, and whatever you do, don’t make any additional payments using the said account, unless you really have to.
Naturally, you’ll want to start working on a budgeting plan to help you save enough money until you’re no longer in the negative, but that can easily become a long-term goal, and you want results immediately.
Find out as much as you possibly can about the situation and get back in control, and you’ll begin seeing results sooner or later.
These fees can happen when you’ve drawn more from your account than you’ve actually got in it, and while the bank may allow you to take this money out, you will be charged a fee that’s usually tied to a percentage of the overdraft.
You should inform yourself of these fees when you’re opening the account, but seeing as this often gets overlooked, it’s not uncommon to find out about them only after you’ve gone into the negative.
Having to pay these fees can make getting yourself back to a neutral balance even more stressful, but it’s all part of the process, and if you’re able to stay calm it shouldn’t be too great of an issue.
The average cost of these fees is usually around $35, although they can be higher depending on the amount you owe the bank, and your account won’t reach a neutral balance until you’ve paid them off entirely.
Keep the account unused
This can prove to be difficult if the account you’ve overdrawn from is the only one you’re using, and things are further complicated by any automatic payments you may have set up.
Address these first, and cancel any subscriptions you may have until you’ve resolved the issue, which won’t be too great of a problem as you can always resubscribe to these services, usually without any additional costs.
If you’ve only got $50 in debt, you’re best off budgeting for a while until you’ve got your balance back to zero instead of taking on additional debt that’ll be even more difficult to pay off.
More debt means you’ll have to think about additional interest rates, and seeing as paying off $50 is much easier than paying off something like $500, you’ll be saving a lot more money than you think.
Continue saving money
If you manage to get your account balance back to zero, this doesn’t mean your job is over just yet, and you should keep saving money until you’re at a balance you’re comfortable with.
If you stop at a neutral balance, it’s only a matter of time before your account balance will go into the negatives again, completely obsoleting all the work you’ve done to deal with it the first time.
In fact, if your account stays in the negative for too long, the bank will continue increasing the fees as a means of forcing you to pay back the debt you owe them until they eventually shut down your account and charge you for the full amount you owe them.
If you’re in need of some quick money, you can organize a yard sale or sell some of your possessions online to get the money you need to save your bank account, and while this can be demoralizing, it can be inevitable if you’re not careful enough.
Take note of your balance at all times, and the moment you realize you’re inching closer to a negative balance employ some budgeting strategies to keep your balance above zero.