You’ve probably heard of the infamous $38 cup of coffee for overdrawing a checking account. If you have an account at Chase, that expensive morning beverage won’t be on the menu for much longer.

Beginning July 22, the banking giant will not charge overdraft fees on purchases of $5 or less. The bank’s checking account disclosure document outlines the change, which includes insufficient funds fees, returned items fees and overdraft protection transfer fees.

It’s a good PR move for the biggest member of the banking industry. However, it doesn’t look like the bank’s executives voluntarily decided to adjust this policy. Earlier this year, the bank settled a class action lawsuit for shady practices that reorganized transaction histories to make even the smallest purchases help trigger additional fees. Ann Carrns at The New York Times blog writes that the bank’s $110 million settlement includes terms that agree to adopt this $5 or less policy for at least two years. Let’s hope that the policy remains in effect after the summer of 2014, too.

Regardless of what banks charge for overdraft fees, it’s crucial to know your balance at all times. Whether you’re still balancing a checkbook or monitoring your checking account online, make sure you’re keeping a log of which transactions haven’t cleared. With a firm understanding of how much you have to spend, you’ll avoid seeing that dreaded insufficient funds fee show up on your monthly statement.

Of course, there is an approach that will absolutely ensure you won’t pay the bank for covering your charges: Opt out of the protection. While you may deal with the embarrassment of having your card declined, I think a moment of humiliation is better than paying an extra $35.

What do you think? Have there been occasions where you want overdraft protection even if it means paying your bank extra for your mistake?

More From Bankrate