Understand overdrafts and how to prevent them
Money Management

Understanding Overdrafts

If you make payments and purchases that are more than the available balance in your checking account, your transactions may be declined, paid by us (causing your account to overdraw) or returned to the payee unpaid.
While we all know not to spend more money than you have, we also know life happens and understand that occasional circumstances may cause an overdraft. In an effort to provide you with more financial flexibility, we are updating our overdraft practices and fees, effective September 1, 2022 to include the following changes:
  • Eliminate the nonsufficient funds (NSF) fee of $36. The NSF fee is charged when a transaction or check is rejected from an account that doesn’t have enough available balance to cover the transaction, and the item is returned unpaid.
  • Eliminate the $5 Consecutive Days Overdraft Fee which is charged after five days of being overdrawn.
  • Increase the de minimis amount from $5 to $10 before an Overdraft fee would occur.
This page outlines common questions regarding our new overdraft practices and some tips for avoiding overdrafts in the first place, including our overdraft protection options.

Overdraft - Q&As

An overdraft occurs when you spend or withdraw more than you have in your account.

When this happens, we will either pay it anyway, causing your account to overdraw or we will decline it and return it unpaid. The decision to pay or decline an item is made based on various factors including your account history and the amount of the transaction.

We do authorize and pay overdrafts for the following types of transactions:

  • Checks and other transactions made using your checking account number
  • Automatic bill payments

As required by federal regulation, we will not authorize and pay overdrafts for the following types of transactions.

  • ATM transactions
  • Everyday debit card transactions

We pay overdrafts at our discretion, which means we do not guarantee that we will always authorize and pay any type of transaction. If we do not authorize and pay an overdraft, your transaction will be declined.

An overdraft fee is the fee that is charged when a bank authorizes and pays an overdraft on your behalf, even if the transaction exceeds the funds in your account. An NSF fee is imposed when a bank returns an item unpaid. As of September 1, 2022, American National will not charge an NSF fee for items it returns. However, a fee may be charged by the payee.

If your account is overdrawn, you will want to deposit or transfer enough money to bring your account to positive as soon as possible in order to keep your account in good standing.

When an overdraft occurs, we will charge $36 each time we pay an overdraft on your behalf. You may incur multiple fees in one day, up to a maximum of six overdraft fees per day.

Effective, September 1, 2022, we will not charge a fee when we return an item unpaid due to non-sufficient funds in your account. However, you may still be charged a fee by the merchant.

We will waive any overdraft fees you would have incurred from transactions that are less than $10 or for transactions of any amount that overdraw your account by less than $10.

American National offers a variety of overdraft protection options, including linking an eligible account, applying for an overdraft line of credit, and Overdraft Express.

Learn about overdraft protection.

Your account's actual balance only includes transactions that have posted to your account to that point in time.

Your available balance is the amount you can use for purchases or withdrawals. It's made up of your account balance minus any pending debit card authorizations and holds on funds.

We use the actual balance to determine whether your account is overdrawn when posting transactions to your account. 

We use the available balance to determine whether there is enough money in your account when authorizing an ATM, debit card, Zelle or other electronic transaction.

Be aware that some things are not included in your available balance such as checks you've written that haven't been cashed and upcoming automatic payments, like gym memberships, car payments, or future payments scheduled through Bill Pay. You should also keep in mind transactions where the final amount may differ from the authorized amount (like when a tip is added). We do not have any control over when outstanding or pending transactions are settled by the other party. 

Note, your "available" balance may not be the same as your account's "actual" balance which means an overdraft or NSF transaction could occur regardless of your account's actual balance.

Effective September 1, 2022, we are eliminating the Non-sufficient Funds Fee, which is the fee charged when an item is returned to the payee. We have also eliminated the Consecutive Days overdraft fee and increased the minimum about before an Overdraft Fee is charged from $5 to $10.

 5 Tips to Avoiding Overdraft Fees

1. Track your balance. 

To avoid overdraft fees and prevent items being returned for Non-sufficient funds, we have a lot of ways to monitor your balance. The most convenient way to keep tabs on your account is through Digital Banking. Whether you prefer banking on a desktop or your phone, you can quickly log in to check your balance. You may also set up telephone banking or call us to get your balance. Be sure to monitor your balance carefully, being mindful of any outstanding or recurring payments.

2. Activate alerts.

Within our digital banking platform, you can set up account alerts. There are many types of alerts, including low balance alerts. These notify you when your balance gets below a certain dollar amount and you may be at risk of overdrawing your account. You can also set up deposit alerts to know when funds you have deposited become available for your use, so you can ensure you have enough money in your account.

3. Opt out of overdraft coverage. 

If you find yourself paying a lot of overdraft fees, consider opting out of overdraft coverage for debit purchases or ATM withdrawals. Without overdraft coverage, your card will be declined if you don’t have enough money in your account to cover a debit purchase or ATM withdrawal. Please keep in mind that you won’t be able to complete the transaction, but you won’t incur an overdraft fee either. If you have chosen a debit card overdraft program, you may end it at anytime. Just contact us to let us know.

4. Link to another account.

To reduce the costs of overdrafting, the most cost-effective overdraft protection option is to link your checking account to a savings account, money market, or even another checking account with us. If you overdraw your checking account, money will be taken from your linked account to cover the difference as long as you have sufficient funds in that account. And unlike many other places, we do not charge you to transfer money from an account to cover overdrafts.

An alternative to a linked savings account is applying for a line of credit to cover overdrafts. There is no fee for using the credit line if is repaid on time. Keep in mind, if not repaid in full, there would be interest due on the amount you borrowed. However, this is generally another way to cover brief periods when your balance is low.

Learn about all of our overdraft protection options.

5. Create a budget.

The best way to avoid financial strain is to know where your money is going and plan ahead. Visit our financial wellness site to learn some tools and tips for creating a budget and be on your way to financial wellness.