checking

Keep savings, checking accounts at 1 bank

Overdraft-protection linking available
Overdraft-protection linking available © AVAVA/Shutterstock.com

If you make a mistake and overspend with your checking account, having a linked savings account can trigger an automatic deposit into your checking. That can help avoid pricey overdraft fees, Reshen-Doty says.

"You can use your savings as a well of reserves, usually for free," she says.

Overdraft fees are not to be disregarded, as they continue to rise. According to Bankrate's 2012 Checking Survey, the average overdraft fee, known in the banking industry as a nonsufficient funds fee, rose to a record high of $31.26, up from $30.83 the previous year. The year-over-year increase is about in line with the 1.4 percent inflation at the time.

Banks also have lines of credit that can be used as overdraft protection, but you would have to qualify for a line based on your credit history, Reshen-Doty says. Linking your savings account to checking could make applying for credit unnecessary.

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