Overdraft facilities?

[Deleted User]

I'll soon (next month at the latest) be DF.

However, I do have overdraft facilities (totalling £700), on two bank accounts.

Should I retain them, or ask for them to be removed?

If retain, should I ask for them to be reduced?

Katzen

Retain them. I never actively use mine but once or twice a year something goes out before the next bit goes in without me noticing and I end up going a couple of quid over. With an arranged OD that costs me a few pennies, if it was unarranged it would cost pounds.

foxgloves

Hi Bedsit Bob,
We both had quite big overdrafts on our old accounts. When we changed banks, we deliberately opted for an account with just a £200 overdraft & just agreed we wouldn't actively use it. So far, 3 years later, we haven't, as getting debt-free taught us a lot about the need for budgeting & slowly starting to build a modest emergency fund. To me, that £200 overdraft facility is just there to absorb any little weird thing where a payment perhaps goes out a bit early & prevents a silly charge for something minor & unintended. However, so far, we've not once gone into overdraft. The money paid into our account each month is the amount of money we have, & the £200 overdraft (like any other form of credit/loan) is now seen by us as spending someone else's money, so it just gets left untouched. It's there if there's an emergency, but we could thankfully now deal with most average emergencies from emergency fund (things like needing new cooker, big car bill, etc). So, my advice would probably be to retain a smallish overdraft facility, then just forget about it. great to hear your big debt free moment is nearly here.
Regards,
foxgloves