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My $10 Mistake and Articles of Interest

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I overdrew my checking account about two weeks ago. It was a stupid mistake. I recently set up an automatic investment for my SEP IRA, $1,750 at the end of each month, transferred from my checking account at Wachovia to Vanguard, invested in VTSMX. On November 30, I checked my Vanguard account, and I didn’t see the purchase pending. Reviewing my automatic investment configuration, I saw the next transfer wasn’t scheduled until December 31.

I assumed I configured the investment incorrectly, so I initiated a transfer for that day, knowing I had a high enough balance in my checking account to cover the transfer. It turns out that although my automatic payment wasn’t visible anywhere, it was in fact scheduled for December 1, most likely due to November having only thirty days.

As a result, I transfered $1,750 twice to Vanguard within two days and overdrew my checking account. Wachovia pulled a few hundred dollars from my savings account to cover the transfer and charged me $10 for the privilege. $10 is more than the approximately $2 I’ve earned in interest from my Wachovia accounts over the past year, so that has been unsuccessful. It’s good that I leave hardly any savings in my Wachovia account.

Here are some articles of interest for this weekend.

My latest contribution to the TurboTax blog is an overview of the American Opportunity Tax Credit, a benefit for current and recently former students with expenses for tuition. While this credit is scheduled to end in 2010, President Obama has called for an extension of the credit for the next two years.

The Part-Time Money Podcast is a new audio show produced by PT Money. The first episode resonated with me, as it featured an interview with a freelance photographer, Justin. Justin, like me, is relatively new to photography and with his extra time, he has been able to build a business offering photography services for families. I’ve had a few clients so far, but my time for photography is still limited. Right now, I’m focusing on building Consumerism Commentary further, but in the future I may be at a point to slow down. At that time, I may be spending more time with photography — or some other interest that develops.

A while ago on Consumerism Commentary, I introduced what I’ve been calling the Debt Avalanche. Hacking the Bank looks at a comparison between the Debt Avalanche and the Debt Snowball popularized by Dave Ramsey. The method behind the Debt Avalanche has been around for a long time, and its strength is that opens the possibility to help followers of the method pay off credit card debt faster and with less interest over time. Any debt repayment plan needs to be tailored to an individual, however, but that’s only possible when they understand how the math works best.

Money Reasons offers the top ten reasons to telecommute during a snowy day. Some jobs don’t lend themselves to working remotely, but for those that do, stay home if the roads are dangerous. It’s as simple as that. You’ll save time, as well.

As of yesterday, Consumerism Commentary readers have surpassed last year’s tally for charitable contributions during the matching period! We still haven’t hit our initial target of $5,000, though. I’ve decided to extend the matching period for one more week, so if you’re waiting to donate to your favorite charity, do it this week to participate in our matching contribution. MoneyCrush will match donations between $5,000 and $6,000, so let’s aim for the higher target.

Consumerism Commentary participated in these carnivals: Carnival of Personal Finance, Carnival of Money Stories, Best of Credit Cards and Saving Money, Carnival of Wealth, Financial Independence Compilation, and Stock Carnival Ecstasy.

Updated January 9, 2018 and originally published December 11, 2010.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 7 comments… read them below or add one }

avatar 1 Anonymous

Thanks for the mention!

I had a buddy that didn’t realize his checking account was as low as it was, and he (actually his wife) wrote 6 bad checks against the 0 balance! It cost them $20 per bounced check, so in all it cost $120!

Now I’m off to read about that Debt Avalanche vs Debt Snowball contrasts!

Have a great weekend!

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avatar 2 eric

Even the most vigilant makes mistake. I’m kinda fanatic about my balance too and I’ve come close a few times to overdrafting.

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avatar 3 Anonymous

Very interesting story! I have often wondered when overdrafting my account will happen to me, as I invest frequently via automatic scheduled transfers that I sometimes forget about. I also try to keep a minimum amount of money in my checking account so that I can let it grow elsewhere in higher interest-earning accounts.

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avatar 4 Anonymous

I had a issue like Money Reasons a few years back. I forgot about an outstanding check (4 months outstanding!) and while treating a buddy who’s girlfriend left him at Christmas time, I overdrew my account 6 times for $35 each.

I thought I learned my lesson, but a math error bit me in the butt and I overdrew my account by $.80 yesterday. Luckily, I’m now with US Bank who forgives one overdraft fee per year, so I only had to put a dollar into my account.

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avatar 5 Anonymous

Thanks for mentioning the podcast, Flexo. I hope you find time soon to do more photography.

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avatar 6 Anonymous

Many credit unions won’t charge at all to transfer money to your savings. And you can take it a step further and get a line of credit to be withdrawn from in case the savings in depleted. This doesn’t cost anything and you can pay it back as soon as possible to avoid the interest

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avatar 7 tigernicole86

At least it was only $10 and not a much higher fee that if you hadn’t had the money to cover it!

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