Planned Overdraft Help

pointer7

Hey Everyone,

I wanted to ask for a bit of advice/tips on reducing my overdraft.

My limit at the moment is £770 and when I get paid, it gets paid off all in one go, but after I put my set amount away each month to cover all bills im usually about £200 into it already.....

Is it best to just try and live on the bare minimum for a couple of months or try and save some money in a seperate account and pay some off just before i get paid each month?

Any help appreciated!

YorkshireBoy

Paid weekly or monthly?

The bank and specific account are?

And the O/D terms are interest or daily fee based?


Suggestions to be going on with:

A lean month or two can make a huge impact.

Move your direct debits back until later* in the month (the day before payday is ideal) as this will limit the time you're using the O/D (and therefore incurring fees or interest).


* Don't 'miss' a month, and don't shift payments to high interest debt such as credit cards etc.

grumbler

pointer7 wrote: »

Is it best to just try and live on the bare minimum for a couple of months

Absolutely.

or try and save some money in a seperate account and pay some off just before i get paid each month?

I don't see how a separate account can help. It will just increase the interest (and possibly fees) you pay for the main account.

pointer7

I'm Paid Monthly at end of the month and I'm with lloyds TSB. I pay about £15 a month to use the £770 planned overdraft.

I could move my direct debits but I like it all to come out when i get paid as I then know that what I have left is what I live on, Plus i have a seperate account which I without fail put a certain amount in each month to cover.

I'm at a kind of plateu at the moment I dont have the need to go over the £770 at all now but I always end up near it so your right, just a case of having a couple of lean months.

100saving

how much of the 770 do you use?

i would do 2/3 months spending the minimum. then once you are free lower or get rid of the overdraft to stop yourself going into it. this would save you £15 a month or £180 a year depends how you look at it.

grumbler

100saving wrote: »

how much of the 770 do you use?

pointer7 wrote: »

...I dont have the need to go over the £770 at all now but I always end up near it ....

then once you are free lower or get rid of the overdraft to stop yourself going into it.

One can stop going into the overdraft without lowering the limit. And, vice versa, lowering the limit can result in going into unarranged overdraft and higher fees and interest.

pointer7

I generally use about 700-770 of it depending.

I thnk its best to reduce it when I need to