My SO has an Overdraft Fee problem. I'm desperate, please help me!

In My Humble Opinion
21

What does this mean, she’s good in bed? She can whip up a mean meatloaf? She takes a shower once a week whether she needs it or not?

Part of looking for a life partner is finding someone with similar values and ethics, someone you can depend on in a crunch. If she’s this wasteful with money, how will you ever buy a house? What financial lessons will she teach your children? That no matter how much you spend, Daddy will bail you out? What happens if you predecease her? Will she manage to run through what you’ve worked hard to accumulate over decades of employment in a matter of months?

She’s a child. You need a woman. Either she straightens up or you bail.

22

Ah, I see. I am confusing debit cards backed by a credit account with pure debit cards. My apologies.

She needs to stop using debit cards, as they are the same thing as checks. Credit cards, although they come with a whole different set of issues, are at least not a source of overdraft fees.

This brings up a previous question – what are the occasions where cash will not work? I know from my own experience that moving to a cash-based economy cut way down on overdraft fees.

23

Oh, and just in case we’re missing something here…does she suffer from some sort of bipolar disorder? Uncontrolled spending is one of the symptoms of manic depression.

24

Yes. Go to a currency exchange, and they can sell you a Visa prepaid card with a Visa logo that works essentially like a gift card - only the amount on it is available. No overdrafts, no interest. They are refillable, which you could do from your computer or phone when she needs her allowance or extra emergency funds.

25

your SO should be the desperate one. Is she worried at all?

Reality Chuck’s idea is a good one, but unless she understands why she’s overspending and agrees to change her lifestyle, she’ll figure a way around any plan you might come up with.

Unless you’re married, how is this your problem? Are you giving her money? Stop. Sometimes it’s cool to be the dependable, responsible adult, but you aren’t doing her any favors.

I have a spendaholic friend. She finally filed for the kind of bankruptcy where a bankruptcy trustee manages your money. In three years she was out of debt and had developed realistic spending habits. Maybe that’s an option.

26

You could always have her convert her paycheck into a Visa (or other) gift card. If she goes over the amount on the card–boom, it’s declined. No danger of an overdraft fee.

Still, though. . .this is some messed-up stuff. There is no reason that she should be this irresponsible with her cash. I mean, my husband is sometimes a bit ditzy with finances (yes, dear, the ComEd payment is still due even if you can’t find the bill), but if he ever started pulling this crap. . .well there’d be a very, very short leash.

I know that you love her. I know that your love for her is not determined by her debit-fu. But an unwillingness to change negative behavior–and the corresponding willingness to inconvenience others as a result–is something that you really need to think carefully about before you go much further into this relationship.

27

I have a sneaking suspicion “emergencies” crop up a lot with this lady. After all, those high-heeled boots won’t be there next week. :wink:

28

Drat. Hit submit too soon. They even have a Visa prepaid card called Visa Buxx which is designed to teach teenagers how to control their spending. She may not be a teen, but she’s spending like one!

29

How are her parents’ spending habits?

30

I hope this is a metaphor.

Honestly, the best bet is probably to close out all accounts and deal with cash only. While there are some problems with that (theft, etc), at least there will be no fees. I can’t think of any situation where she couldn’t use cash, most realtors will even let you pay your rent in cash if you want. Maybe she’d have some problems if she wanted to buy something on Ebay, but someone like this shouldn’t have the run of Ebay anyway. And you can get a safe to store the cash, and you could not tell her the combination of the safe, if you think she’d spend it all at once or something. I know a lot of workplaces insist on direct deposit but if you explain the situation they’ll most likely draft a check. Of course, you should probably go to the bank to cash the check since she probably can’t be trusted to do that.

And yeah, there is something not-quite-right mentally with someone who is so bad at managing money. Don’t ever open a joint account with this woman.

31

Ok, I don’t know, but I think this needs to be said: the woman needs to hit rock bottom on her own, without anyone bailing her out. And you need to not feel guilty.

Seriously, this woman needs to learn to live without someone bailing her out. And if what it takes is to be kicked out of her apartment when she doesn’t have money and suffer a little, then that’s what it takes. I know it sounds cruel but man, she can’t be dependent on you forever. What happens if something happens to you?

32

Cash has no purchase protection, no theft protection, etc. Visa prepaid cards do.

Just sayin’.

I’ll stop pimping the Visa prepaid cards now! :smiley:

33

Check with the bank that she’s at and see if they have overdraft protection available. I believe they will charge you a monthly fee for this and interest on the amount that you go negative, but it’s still way cheaper than hundreds of dollars in overdraft fees.

34

There is a solution that might work, in that it would entail minimal changes in your SO’s behavior, and yet would protect you from overdraft fees. I forget the exact term, but basically it’s a bank card that’s not tied to your bank account – you put X amount of dollars (say $500 or $1000) into it, and that’s how much money you can withdraw. They come with Visa logos and such, and work just like credit cards except that as soon as the money is sucked out of them, they stop working. There’s no overdraft fee involved in most cases (careful, some banks DO have such fees, for reasons I’ll get to in a minute), it’s just that when the $500 or whatever is gone, the card won’t work for you. If your wife has such a card and a cash reserve in her purse at all times for emergencies when the card runs out and she needs gas or whatever, she should be just fine. There’s still the possibility of a $29 overdraft created by filling the card, but that’s just $29 a month rather than the OD fees you cite.

These cards also charge fees to load the card with money, but it’s generally very reasonable compared to those $29 overdraft charges.

This might work since she’d still have a card and could spend just as before. She might hate the inconvenience of having the card go out on her when she screws up, but at least she won’t have to pay hundreds of dollars to the bank for that privilege.

Now, here’s what you have to understand. The bank absolutely LOOOOOVES your wife. The term they use for those ODs is fee income, and mighty fine income it is, since it only costs them about a buck to process an OD, which means the $28 remaining is gravy. That’s why banks always pay your largest debits first … they say it’s because that way important debits like the rent are covered first, but the real reason is that they’d rather hit you up for 7 charges of less than $10 (with a $29 fee for each) than hit you up for one $29 fee for the rent check. Plus, they don’t like covering large checks anyway. (that’s why some “fee paid” card will have OD charges … they want that $29 fee).

What I’m saying is that banks are predators and your SO is the prey. If she can’t or won’t keep track of her purchases, the fee-paid card or just cashing out most of her check each month is the only way to go. (That is, she can take out the bulk of her check, leaving a small amount to cover things like recurring charges, and use cash to pay all her transactions.

If she can’t make either of these adjustments, you’re screwed, buddy.

35

As others have mentioned, a prepaid VISA substituting for cash in Ivylass’s recommendation is the best thing I can think of. However, you both need to address her spending issues because otherwise it’s going to lead to a huge problem in your relationship.

If she’s as bad at money management as you say, there are going to be weeks when she’s spent everything on her VISA card and comes to you for gas money to get to work (or another need she didn’t plan for). When that happens you’re going to be in the tough position of either enabling her bad spending habits (just without overdraft fees) or denying her money for something she may very well need (like gas to get to work). That puts you in the position of a parent doling out an allowance and not a partner in a relationship. A rough situation for both of you that can lead to a lot of resentment.

If you’re set on continuing this relationship, you both need to decide that she can and will change her spending patterns. It’s not going to happen immediately and it can be a tough thing to change. I don’t know if credit counselors can help since the issue isn’t repairing her credit, that’s already toast, as much as controlling her spending. They may. I just don’t know enough about them. I’m sure there are books out there that address over spending issues.

One thing I’ve noticed is that many people who over spend have no idea how to manage money or where it goes. They start out the week with $100 and by Wednesday have no idea why it’s all gone. Keeping a spending diary for a time and writing down everything they spend money on (literally everything–down to the morning cup of coffee) can help with that. But that’s just one small thing. I suspect your SO’s issues go beyond that. As mentioned earlier, you may want to check out what books or financial counseling services are available.

36

To start, why not cut up the card and keep the checks locked away somewhere, shred them? The bank doesn’t force any account holders to take and use the debit card. She can refuse it, or destroy it, and pay for things with cash. If there are bills that need to be paid, she can get USPS money orders.

I know someone who acts EXACTLY like your SO does, and she also is in Florida. Your SO’s name doesn’t start with J, does it? My friend, by the way, is bipolar and this is one of the manifestations of the disease. She’s got $20,000 in unpaid bank fees and bounced checks. How she has managed to avoid jail I’ll never know.

37

They’re not married, so I doubt this will work. The direct deposit will only go into an account with her name on it, which she will have access to. They will also only make the paycheck out to her, not to her SO. Her boss is not her babysitter, what does he care what she does with her paycheck?

38

A lot of those cards charge a fee to put money on the card, and if you don’t use it all by the expiration date the money is lost (not that that’ll be a problem with this person). Although it is a much better solution than a debit card, if she needs to use a card.

I second the suggestion of a spending diary, so you and she can know just where the money goes, but if she’s as flaky as described I doubt she’d keep up with it.

39

People have mentioned a spending diary so I’d thought I’d mention my solution (if your SO decides she’s interested). Almost everywhere gives you reciepts nowdays. I just collect my reciepts and enter them daily into a spreadsheet. She could use a check register. It’s a lot easier to do once a day than to take the time after each purchase.

The spreadsheet does all the math (and I find it much less cumbersome than MS Money or Quicken). My spreadsheet (I heavily modified one I found on the web) has a sheet for daily entries and keeps a running bank account status as well as a monthly summary so I can see how my spending has changed from month to month.

40

Gozu, you’re right about not expecting your SO to change. She may, but only when she’s truly forced to (i.e. when there’s no one left to bail her out), and maybe not even then.

So how do you fix this problem? Simple: you don’t. Keep your finances completely separate and don’t give her a dime. Don’t let her use your cards, don’t pay her rent “just this once”, don’t make her financial problems your business. You’re not helping either of you one bit by putting out her short-term fires. If she can’t have a relationship with you without you giving her money, then you shouldn’t be in the relationship.

She has a serious problem, and it really should be a deal-breaker for you in terms of marriage or a serious long-term relationship. It sounds coarse and unromantic to let money problems dictate whether or not to stay with someone, but being with someone who is financially self-destructive can really screw up your life. It’s really no different from marrying a compulsive gambler or crack addict.