Overdraft back-up plan

cb_999 · 18 November 2009 at 11:47AM

Hello,

As I'm recently taking a lot more interest in things financial and started to poke around the forums on this site I think I am a bit worried about my situation.

I currently have a 9000 od with Lloyds on their Premier Account , my balance normally ends up at between -7500 and -7600 at month end, however I did get about 1500 compensation for a car write off a couple of months ago and that's paid of some of the od.

My concern is that if Lloyds decided to reduce my overdraft for whatever reason down to whatever it is on the day they did it, I would be screwed, especially if that was payday. I'm not self employed or anything and I put about 2.5k in per month for my wages.

I'm thinking maybe I should "hide" away enough for a months worth of bills somewhere? What's the prevailing thinking?

onlypaddy · 18 November 2009 at 12:59PM

I see you're a DFW long Hauler so you will have seen the link http://www.makesenseofcards.com/soacalc.html

Do this and see where you can cut down. Maybe ask Lloyds to reduce your overdraft by a set amount monthly, then you wont have it there to use any more.

cb_999 · 18 November 2009 at 1:08PM

Thanks, I've done all the maths, and at present my overdraft will be the last thing to be paid off (in about 4 years time once all my cards are toast). But what I am worried about is that at some point Lloyds taking down my overdraft so that I am unable to pay the bills for that month thereby trashing my credit rating/getting me very stressed. Maybe I'm just being paranoid?

onlypaddy · 18 November 2009 at 1:46PM

It's a worry, I know - Im in the same postion myself, but its more likely for them to remove mine as its not my main account any more. Its my understanding that as long as you keep paying into it and keep your head down it should be ok

nuttyrockeress · 21 November 2009 at 8:14PM

On this I would say don't hold your breath.....

My overdraft is 500 quid and I have a Premier account too and have had a letter today to say this is going to be removed.

I use my od most months but it is always paid back and more when my wages go in my account.

So on that note I would say don't keep your head down, do something pro active and start to pay off if you can.

LeeSouthEast · 21 November 2009 at 9:15PM

Perhaps, even though the cards may be a more expensive debt, it'd make more sense to attack the overdraft first? A credit card agreement will not normally be withdrawn with 30 days notice. An overdraft can be, and are being, in the current climate.

For my own peace of mind, I'd rather pay an extra grand or two interest but be safe in the knowledge that my entire plan is not at the whim of my bank.

Overdraft back-up plan

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