In 2016, banks in California and across the U.S. collected about $33.3 billion in overdraft fees from consumers. This is, of course, a huge problem because the last thing cash strapped California consumers need is the unnecessary expense of bank overdraft fees. This also signifies a scary trend among California residents. Apparently, a lot of banking customers struggle with their monthly cash flow. This probably means that they aren’t putting money into savings. Therefore, for these consumers, one major, unexpected expense could spell financial disaster. A large medical bill or a significant car repair could cause them to get behind on other bills and ruin their credit scores. Recently, some tech-savvy startups have introduced mobile phone apps that help consumers avoid overdraft fees. However, these apps don’t address the underlying problem.
How Makers of New Mobile Phone Apps Claim to Help California Consumers Avoid Bank Overdraft Fees
If California banking customers research the latest mobile phone apps designed to help consumers avoid overdraft fees, they’ll find several options. Interestingly enough, some of these apps do more than send the user an alert when their banking account is low. Apps like Dave, Float, and Activehours actually allow consumers to take out small loans to cushion nearly depleted funds until payday comes.
For example, Float is an app that offers California (and Utah) consumers what seem like traditional payday loans. Yet, there are noticeable differences. California consumers who use Float can ask for small loans with a simple text message. These are short-term loans (due in less than 30 days) that come with a very small (5%) fee. So, this factor alone makes them better than a typical payday loan.
However, even though these loans might prevent fees, they can still put users on a never-ending loan cycle. Just like with payday loans, consumers grown dependent on the ability to borrow money to carry them from paycheck to paycheck. This may deter some California residents from sticking to budgets and building up emergency funds. This is unfortunate because only these actions are proven to protect consumers against unexpected expenses and credit score damage.
How California Consumers Can Avoid Bank Overdraft Fees Without Relying on Short-Term Loans
Financial experts often advise California banking customers to opt out of overdraft protection. Sure, this eliminates the threat of overdraft fees, but it does nothing to correct cash flow problems. Instead, California consumers who have trouble making ends meet should tailor their spending to their incomes. This involves creating a monthly budget that includes room for saving.
Having money set aside to cover emergencies is the only way to cover sudden expenses without taking on debt or neglecting other bills. This is also the “best bet” option when it comes to protecting credit scores. Another way for California residents to maintain and build good credit scores is to regularly check their credit reports. By knowing the contents of your credit reports, you can protect yourself against credit score damage caused by identity theft. This also allows you to catch errors made by creditors and credit reporting bureaus that might bring down your credit score.
Checking your credit reports once every 12 months is easy and costs nothing. Just go to www.annualcreditreport.com to request credit reports from TransUnion, Experian, and Equifax. Credit reports obtained from this site are admissible in the disputing process if you find fraudulent accounts or errors to remove. Also, the best way for California residents to get these items removed from their credit reports is to call Credit Repair Lawyers of America. When you contact our firm, an experienced credit attorney will fix your credit for FREE.
The Free and Legal Way to Get Better Credit
Don’t let fraudulent items or errors on your credit reports bring your credit score down. At Credit Repair Lawyers of America, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? All of our fees come from the defendants in settled cases. This is why our clients pay nothing for the work we do.
Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (916) 438-9400 or sending him a message through our contact page.
For more information about Free Credit Repair, please visit https://creditrepairlawyersam.com/california/credit-repair-ca/. Or, to learn more about Free Credit Repair After Identity Theft, check out https://creditrepairlawyersam.com/california/fix-identity-theft-ca/.