Transcripts

"Money File"-Fight The Fees

SUSIE GHARIB: In tonight's "Money File," eliminating extra fees that banks and credit card companies impose. Here's Harriet Johnson Brackey, personal finance columnist at the "South Florida Sun Sentinel."

HARRIET JOHNSON BRACKEY, PERSONAL FINANCE REPORTER, SO. FLORIDA SUN- SENTINEL: Overdraftees are out of control. We're ringing up more than $17 billion a year in overdraft charges and I don't think it's because consumers don't know how to balance their checkbooks. I think it is largely the fault of banks, which have added something called automatic overdraft protection to checking accounts in recent years. That means they always OK your debit card purchases, whether there is money in the account or not. A government study shows most banks never even told consumers about this. This is protection, but for whom? Not for someone who puts a $5 hamburger on a debit card, only to find that it triggered $30 in overdraft fees. What you can do about it is tell the Federal Reserve you don't want it. Bank regulators have proposed giving consumers the right to opt out of automatic overdraft protection and we should have that right. And while it's writing new rules, the Fed is also looking to make changes in credit cards. One proposed rule would require cards to give you a reasonable amount of time between when the bill arrives and the payment is due, so that you're not hit with late fees so often. Another would prohibit credit card companies from hiking the interest rate after you make a purchase on your balance. Now, those are real protections for consumers and we need them. Speak up, I say. You have until August 4 to tell the Fed how you feel. I'm Harriet Johnson Brackey.