Only 3k of debt, but from 8 years ago!

immuno · 30 March 2015 at 12:42PM

Hi guys,

I guess I just wanted to share my situation, as I feel that if I write it on here and tell people, I'll be more inclined to act on my words. I had a 3k overdraft 8-9 years ago, when I first went to uni. I have been working for the past 4-5 years, but for some reason, I just haven't paid off the overdraft. It was initially interest-free, but now it's with interest and a monthly charge (I had a student/graduate account, and now it's a standard account). I could transfer this to 0% interest, etc, but really I just want to pay it off as soon as possible. I just find the timescale depressing, as it feels like it has been so long. I have a lot I want/need to save for, so I'm not sure if I should be saving half each month and paying off the rest (ie. 250 for saving, 250 for overdraft), or just try to clear this overdraft as quickly as possible. I think I need to change my mentality in the long-term. For 8 years, I have seen "current balance" as £-3,000, but "available balance" as £+1,200 or whatever, so have just thought that I HAVE those 1,200...I am thinking of getting rid of the overdraft feature once I have paid it off, so that I'm not tempted in the future. My partner refuses to even have an overdraft set up, so perhaps that is the way forward...

I have started a second, evening job, so I'm hoping that will help!

:)

MilkyMilk · 30 March 2015 at 1:50PM

Hi Immuno

I don't know how useful a comment from me would be as I have only just joined this forum, but it's actually brave to open up about your debt, coz by going public, you are more likely to do something about it. So you've made an important start, and being on the forum for support will help to get you there.

Talk to people on the forum and stay open about this with your partner, and keep going.

Best wishes

))

MrWillyWonka · 30 March 2015 at 2:30PM

If the overdraft is costing you money then there is no point saving up. It is highly unlikely that the interest you get in savings is more than the interest you are paying on the overdraft. I'm surprised the back hasn't asked you to pay it back in so long - they are allowed to stop your OD and ask for it back with short notice so it is in your interest (no pun intended) to pay off the OD asap.

If you pay £500 a month into it, you could clear it in ~6 months.

It's also a good idea to have at least some OD for leeway or as an emergency short term cash - but only if you can trust yourself not to spend it - that involves changing your mentality in regards to having a negative balance or average balance.