Define the term 'overdraft'.

The term 'overdraft' refers to a banking feature that permits account holders to withdraw more money than is currently available in their checking account, effectively allowing them to go into a negative balance. This feature can be helpful in situations where immediate access to funds is needed, even if the account doesn't have sufficient balance at that moment.

When an overdraft occurs, the bank typically covers the transaction, and the account holder will incur an overdraft fee, depending on the bank’s policies. This concept is critical in personal finance management, as it provides flexibility but can also lead to unexpected charges if not managed properly. Understanding overdrafts is essential for anyone using a checking account, as they can impact budgeting and financial planning.

The other options relate to different financial concepts that do not describe 'overdraft': loan interest pertains to borrowing costs, withdrawing from savings involves different types of accounts and fees, and investment strategies pertain to how individuals manage their portfolios. Thus, the correct understanding of an overdraft directly aligns with the definition provided.