January 14, 2021

Can You Overdraft a Credit Card, Debit Card, or Savings Account?

Overdraft protection is a banking service consumers can opt into to overdraw their checking accounts for a fee. For instance, if your account only has $10 in it and you forgot about your upcoming $15 Netflix subscription, your payment will still go through because 1) your bank can loan you $5, or 2) you have a backup account linked. Your bank will charge you an overdraft fee either way, and Bankrate reports that [the average fee is $33.47](https://www.bankrate.com/banking/checking/checking-account-survey/#:~:text=The%20average%20overdraft%20fee%20(%24,interest%20checking%20account%20(%245.27).).

“Can I overdraft my debit card?” you ask yourself. “What about my credit card? Or my savings?” You know it’s possible to overdraw your account with online payments, and you’ve heard of people doing it with checks, so it’s understandable to wonder what other kinds of accounts allow you to make transactions without sufficient funds. If we’re going to use the term “overdraft” as a verb, let’s dive into the possibilities.

Can You Overdraft a Debit Card?

Yes, you absolutely can overdraft a debit card.

Let’s say you had $5 in your account this morning, but today is payday, so you should have plenty of money by the afternoon. Unfortunately, your employer’s payroll system takes longer to deposit your paycheck, so you won’t have the funds you expect some time until next business day. You use your debit card to buy a $7 slushie from the convenience store without knowing your real balance. The transaction goes through because you have overdraft protection, but now you owe the bank $35.47 — $2 for what it loaned you and $33.47 for the service.

You can call the bank and try to explain, but you just purchased a really expensive slushie if they decide not to waive the fee. It was such a small difference, too, but overdraft fees are fixed. Your debit card is connected to your checking account, so debit card overdrafts are a common way to incur such fees.

In addition, banks will often set overdraft limits. Even if you have overdraft protection, this means you cannot borrow more than your bank will allow if you overdraw your account (such as $500 or $1,000).

Can You Overdraft a Credit Card?

No, a credit card overdraft is not a thing — at least, not exactly. Because using your credit card entails borrowing money from your credit issuer, there is technically no finite amount of money in an account to withdraw from.

However, it is possible to reach and exceed your credit limit. Your credit limit is the maximum amount of money your issuer is willing to let you borrow. This number varies between different cards, institutions, and individuals, so it could be as little as $200 (such as putting down a deposit on a secured card) or as much as $500,000. Your card will decline if you attempt to make a purchase that pushes you over your credit limit.

Unless you have over-limit coverage, that is. Similar to overdraft protection, over-limit coverage is a service you must opt into with your credit issuer that enables you to exceed your credit limit in exchange for a fee. Your bank cannot charge you fees for reaching your limit, only if you agree to surpass it.

Keep in mind, though, that using too much of your available credit could negatively impact your credit score. Experts suggest using approximately 30% of your credit limit. For instance, if you have $15,000 in available credit, then making more than $4,500 worth in purchases or expenses could make you seem like a risky borrower.

Can You Overdraft a Savings Account?

Fortunately, a savings account can only be emptied, not overdrafted. That said, different rules influence your ability to withdraw from your savings.

US law dictates that you cannot make more than six convenient withdrawals from your savings account per month (“convenient” includes transfers made via phone, online, check, etc.). Your bank may charge you a fee if you exceed this number of withdrawals or refuse the transaction. However, it’s possible to exceed the six-withdrawal limit if you use “inconvenient” methods, such as visiting a bank branch in person, taking out cash from an ATM, or requesting a check.

How Can You Avoid Overdraft Fees?

Though you cannot overdraft savings accounts or credit cards, it’s beneficial to be careful with your checking account, so you avoid overdraft fees. A few ways you can elude overdraft fees include:

  • Opting out of overdraft protection;
  • Enabling low-balance alerts, so you know when you are at risk of overdrawing your account;
  • Linking your checking account to your savings as a backup.

You can also use financial apps to manage your various accounts and keep a watchful eye on your financial situation. If you have a low balance with no choice but to pay a necessary expense, then Earnin allows you to access up to $100 per day from your paycheck before the typically scheduled date without taking out a loan. Likewise, Mint is helpful for budgeting, and Peak can help you visualize your financial goals.

You’re not alone if you’re worried about overdrafting, but rest assured, you cannot overdraft a credit card or savings account.


Photo by Timeo Buehrer on Unsplash

Please note, the material collected in this blog is for informational purposes only and is not intended to be relied upon as or construed as advice regarding any specific circumstances. Nor is it an endorsement of any organization or Services.

You may enjoy

Did You Overdraw Your Account? Here's What to Do
Did You Overdraw Your Account? Here's What to Do
If you overdraw your checking account, you should replenish your funds, enable low-balance alerts, and use other strategies to avoid it in the future.
Is Overdraft Protection Worthwhile?
Is Overdraft Protection Worthwhile?
Overdraft protection enables transactions to complete when you have insufficient funds, but it has benefits and drawbacks to consider before opting-in.
Dollars and Sense: Checking Versus Savings Account
Dollars and Sense: Checking Versus Savings Account
Explore the key differences between a checking versus savings account. Here’s how to optimize your personal finances and grow your money.
What Happens if You Go Over Your Credit Limit? The Financial Impact
What Happens if You Go Over Your Credit Limit? The Financial Impact
New credit card? Make sure you understand what happens if you go over your credit limit and how it impacts your credit report before you start spending.
An Introduction to NSF Fees: Why Were You Charged?
An Introduction to NSF Fees: Why Were You Charged?
NSF fees are fees your bank charges you when you attempt to make a purchase with nonsufficient funds in your account.
Crafting Tomorrow's Success: What is a Savings Account?
Crafting Tomorrow's Success: What is a Savings Account?
Learn the savings account essentials, like what a savings account is, its benefits, and how it aids your financial planning and future financial security.
Credit Cards vs. Debit Cards: Differences & Which Is Better
Credit Cards vs. Debit Cards: Differences & Which Is Better
Debit vs. Credit Cards: Discover their use differences and use cases, plus the pros and cons of each form of payment.
Cash Management Accounts: The Gateway to Financial Freedom
Cash Management Accounts: The Gateway to Financial Freedom
Unlock financial freedom with a cash management account (CMA) that combines the best of checking, savings, and investment account features.
Tap, Load, Spend: How Do Prepaid Cards Work?
Tap, Load, Spend: How Do Prepaid Cards Work?
How do prepaid cards work? We’ll explain how and why you might use these cards, how they affect credit, and how they differ from debit cards.
Worried About Overdraft Fees? We Got You Covered
Worried About Overdraft Fees? We Got You Covered
What is a Returned Item Fee and Why Was I Charged?
What is a Returned Item Fee and Why Was I Charged?
EarnIn Announces They Have Provided Access to $10 Billion in Earnings for Members
EarnIn Announces They Have Provided Access to $10 Billion in Earnings for Members
Earned Wage Access provider has processed over 125 million transactions, unlocking financial freedom for more than 2.5 million active users.

EarnIn is a financial technology company not a bank. Subject to your available earnings, Daily Max and Pay Period Max. EarnIn does not charge interest on Cash Outs. EarnIn does not charge hidden fees for use of its services. Restrictions and/or third party fees may apply. EarnIn services may not be available in all states. For more info visit earnin.com/TOS.

Download on the App Store
4.7 +189K ratings
Download on Google Play
4.6 +200K ratings