What does Regulation E mean for consumers?

Starbucks is expensive enough as it is. But $36 dollars for a latte? That's a little extreme.
That's what banks are allowed to charge if the account the money being drawn from is negative. The charge is called an overdraft fee, and it makes up a significant part of the revenue these financial institutions make each year.

Regulation E, newly passed through Congress, aims to stop banks from being able to charge customers when they clearly don't have the money in their accounts.
The regulation is optional, however. If you decide to ‘opt-in' to overdraft protection, this has no effect on your account. If you ‘opt-out,' however, that's when Reg-E takes effect.
If your account is negative or empty, any debit card transactions or ATM withdrawals will be denied, and the account will remain the same. While it does stop overdraft fees, it can also be an inconvenience to those who need a little bit of leeway when cash is tight.

Checks and credit transactions are not affected by Reg-E, even if you do ‘opt-out.' That means that if a check is written and the money isn't there, the account will go negative and get charged an overdraft fee, as usual.
While most customers should be receiving a letter or email notification about the change, Bank of America decided to do away with overdraft protection altogether. This means there will be no opting in or out; if the account has no money, debit card and ATM transactions will be denied. As the largest issuer of debit cards in the United States, Bank of America is willing to take the ten million dollar hit that will accompany the loss of overdraft fees.

Customers creating accounts after July 1 will have to decide right then and there whether or not to opt-in, whereas existing customers have until Aug. 15 for their decision to be made and to take effect.
The broad goal of this regulation was not to just stop debit card fees, but to encourage responsible spending and to stop consumers from spending money they don't have.

Maybe skipping that coffee drink in the morning wouldn't be that bad after all.

-Kyle McDaniel