Overdraw
Categories: Ethics/Morals, Banking, Bonds
To take out more money than you have in an account.
Example
Let's say you have $200 in your account, but you have automatic bill payment set up. This month, your bills total $250, so that much is taken out of your account by the electric company and their buddies. That means your account is overdrawn $50 ($200 – $250).
In most cases, if you overdraw your account, the bank or financial institution will hit you up with big fees. However, you can buy overdraft protection, which protects you in this type of situation. Worth it? Depends on how much you trust yourself not to overdraw.