Overdraft help!

Angeleek

Hello

I've been browsing this site for a while now and I have learnt a lot but I now have unfortunately run into my own difficulty and I'm at a little bit of a loss what to do. (Hopefully I'm in the right place, if not, please do direct me!)

Ok so, I have this overdraft with Lloyds TSB, it's currently sitting at -£2000 and rising (max limit is £2500). It's on my Platinum account so my current interest is at around 12%, and I pay £17 for it, plus £5 to actually be overdrawn.

I've been using this overdraft for a couple of bills for a while but it's been used as an emergency fund for moving house and other such things and I'm now at the point where I can't seem to get the amount down.

I pay £200 into it a month (which is about as much as I can afford to at the moment) but I have 3 bills that come out (mostly insurances for my car and my mobile phone bill) that = roughly £150, then I have all the account charges added on, so as you can imagine, I'm not really keeping on top of it as much as I should be!

I've applied for a money transfer credit card through Virgin (the 22 month interest free one) but they rejected me purely because I've made a lot of changes this year to my life (new job, new car, new home) so was classed as an unstable candidate, even though I earn a reasonable wage!

What I need help with now is where on earth can I go from here? I'm anxious my overdraft is only going to get worse, I can change my mobile phone contract in January and I aim to make that cheaper and get it to come out of my current account (I have 2 bank accounts with Lloyds), and change the other insurances to come out of my current account also, but this does not solve my mounting overdraft issue!

Please can anyone suggest any plans of action? I haven't yet spoken to my bank, as I'm not really sure what they can actually do for me, other than try and offer me a loan (like they always do) at a higher interest rate than my overdraft!

Tixy

Hi and welcome, this is the right place to post.

And I wouldn't speak to your bank just yet until you've had a closer look at your finances, you might find that by talking to them they will simply recall the full overdraft.

I think its probably difficult because you are looking in isolation at what is going in and out of this account, and it would be better to consider your full finances, obviously this account debt is rising, if you other accounts are neutral (same balance and the beginning and the end of the month), then you must have outgoings that are higher than your income each month.
And if that is the case then I would suggest you write up a detailed income & expenditure account (statement of affairs) so you can see how much of a shortfall you have each month, and to try to find areas you can cut back, so that at the very least your income & outgoings balance and the debt stops increasing.
We use this calculator - http://www.makesenseofcards.com/soacalc.html which helps paint a really clear picture of your finances and if you post the results on here people can see if they can come up with suggestions of where you could make savings, get things cheaper, try to cut back etc.

Angeleek

Really appreciate your advice! I'll fill out that online form when I get in from work tonight as I'm unsure of the interest rate on my car finance etc. I'll then post the results, I'm interested myself to see what the results are because I don't think I really think about all the extra bits and pieces I spend on things a month!

Tixy

That form should help - it really makes you think about where your money is going.
Also might be worth thinking about starting a spending diary for a month or 2. Where you write down every single spend you make (even those little things like a cup of coffee or a newspaper etc), and then at the end of the month frighten yourself by how much you've spent in certain areas compared to what you would estimate.

Angeleek

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1475
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1475
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 448
Rent.................................... 340
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 10
Gas..................................... 10
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 0
Mobile phone............................ 35
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 40
Clothing................................ 10
Petrol/diesel........................... 160
Road tax................................ 0
Car Insurance........................... 89
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 30
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1262

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 12500
Other assets............................ 0
Total Assets............................ 12500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Secured Debt.................. 2000.....(200)......12
Hire Purchase (HP) debt ...... 14000....(248)......12
Total secured & HP debts...... 16000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-

Monthly Budget Summary
Total monthly income.................... 1,475
Expenses (including HP & secured debts). 1,262
Available for debt repayments........... 213
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 213
Personal Balance Sheet Summary
Total assets (things you own)........... 12,500
Total HP & Secured debt................. -16,000
Total Unsecured debt.................... -0
Net Assets.............................. -3,500
Created using the SOA calculator. Reproduced on Moneysavingexpert with permission, using IE browser.

So this is the results (got totally delayed this weekend so didn't get round to sorting this till today!) And seems I'm in a better position than I thought actually! I've been speaking to my partner (who earns a lot more than I do but has his own debts to pay) and we're going to make a budget spreadsheet starting January and see how much we can actually save next year and are aiming to have everything paid off by the end of next year! I'm starting to get into a horrible habit of just chucking things on my bank card and not checking my statement for weeks! So I'm going to change that but that website has opened my eyes some! I shall need to do some maths and work out some things. Thanks everyone for your help! I shall start working on my budget and make a spending diary as suggested, starting right now!!

Giddytimes

Angeleek wrote: »

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1475
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1475
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 448
Rent.................................... 340
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 10 (Eec & Gas seem very low, even if this is just half of the monthly amount, have you checked these figures?)
Gas..................................... 10
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 0
Mobile phone............................ 35
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 40 (This also seems very low, do you really only spend 40 a month on food and other groceries?)
Clothing................................ 10
Petrol/diesel........................... 160
Road tax................................ 0
Car Insurance........................... 89 (Can you shop around? Swap for a more economical car? This would save you petrol too)
Car maintenance (including MOT)......... 0 (You'll need to budget something for this unless it's covered by your company)
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0 (You should be budgeting for this too)
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0 (No house insurance?)
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0 (You'll need to bodegt for presents unless you genuinely don't buy any)
Haircuts................................ 0
Entertainment........................... 30
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1262

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 12500
Other assets............................ 0
Total Assets............................ 12500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Secured Debt.................. 2000.....(200)......12
Hire Purchase (HP) debt ...... 14000....(248)......12
Total secured & HP debts...... 16000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-

Monthly Budget Summary
Total monthly income.................... 1,475
Expenses (including HP & secured debts). 1,262
Available for debt repayments........... 213
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 213
Personal Balance Sheet Summary
Total assets (things you own)........... 12,500
Total HP & Secured debt................. -16,000
Total Unsecured debt.................... -0
Net Assets.............................. -3,500
Created using the SOA calculator. Reproduced on Moneysavingexpert with permission, using IE browser.

So this is the results (got totally delayed this weekend so didn't get round to sorting this till today!) And seems I'm in a better position than I thought actually! I've been speaking to my partner (who earns a lot more than I do but has his own debts to pay) and we're going to make a budget spreadsheet starting January and see how much we can actually save next year and are aiming to have everything paid off by the end of next year! I'm starting to get into a horrible habit of just chucking things on my bank card and not checking my statement for weeks! So I'm going to change that but that website has opened my eyes some! I shall need to do some maths and work out some things. Thanks everyone for your help! I shall start working on my budget and make a spending diary as suggested, starting right now!!

Certain things stood out to me when I read your SOA, see my comments in red above.
I think a spending diary for the next few months will help you to see where your money is really going. Some of those figures look low, but it may be because your partner is paying for some of the expenses?

GreenSaints

Hi,

Let me first start by saying I love your avatar! I love Studio Ghibili films

Secondly, I cleared a £1k overdraft this year just by selling all my unwanted tat! Can you do something like that? Whether it's eBay, car boot sales or flogging stuff to friends.

Have a look at the Up Your Income board to earn some extra money Mystery Shopping and doing surveys. Not going to make you rich over night, but it all helps.

Anyway, you've come to the right place. We're all here to help as we've all been in your situation - I still am!

antonia1

Angeleek wrote: »

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2 If you are have separate finances, this should just be 1
Number of children in household.........
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1475
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1475
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 448
Rent.................................... 340 Presumably this is your half, is this reasonable for your area?
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 10 Seems low, is this your half?
Gas..................................... 10 As above
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 0
Mobile phone............................ 35 Quite high, can you move to pay as you go or drop a tariff
TV Licence.............................. 0 Need to budget here (£12ish per month)
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 40 Seems low, are you sure this is correct?
Clothing................................ 10
Petrol/diesel........................... 160 Seems high - do you cover a lot of miles?
Road tax................................ 0 need something here
Car Insurance........................... 89 did you shop around?
Car maintenance (including MOT)......... 0 Need something here
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0 Need something here - dentist check up at least
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0 Should have this really
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0 Not even at christmas?!
Haircuts................................ 0 Never?
Entertainment........................... 30
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1262

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 12500
Other assets............................ 0
Total Assets............................ 12500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Secured Debt.................. 2000.....(200)......12
Hire Purchase (HP) debt ...... 14000....(248)......12
Total secured & HP debts...... 16000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-

Monthly Budget Summary
Total monthly income.................... 1,475
Expenses (including HP & secured debts). 1,262
Available for debt repayments........... 213
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 213 do you actually have this left each month?
Personal Balance Sheet Summary
Total assets (things you own)........... 12,500
Total HP & Secured debt................. -16,000
Total Unsecured debt.................... -0
Net Assets.............................. -3,500
Created using the SOA calculator. Reproduced on Moneysavingexpert with permission, using IE browser.

So this is the results (got totally delayed this weekend so didn't get round to sorting this till today!) And seems I'm in a better position than I thought actually! I've been speaking to my partner (who earns a lot more than I do but has his own debts to pay) and we're going to make a budget spreadsheet starting January and see how much we can actually save next year and are aiming to have everything paid off by the end of next year! I'm starting to get into a horrible habit of just chucking things on my bank card and not checking my statement for weeks! So I'm going to change that but that website has opened my eyes some! I shall need to do some maths and work out some things. Thanks everyone for your help! I shall start working on my budget and make a spending diary as suggested, starting right now!!

Spending diary an excellent plan, as is a budget. If you want you can post your budget as an SOA and people here can see if it seems realistic.