Overdraft - Which bank?

pimento

Are there any high street banks that will not allow you to exceed your overdraft?

By that I mean if you try to spend or withdraw money your card will be declined?

Archi_Bald

Not to my knowledge. They can't really do that because they do no necessarily have a complete record of what you have spent on your debit card, and what hasn't yet been claimed by the retailers. Nor do they know whether you'd pay in any more money before the end of the day.

Best if you just face reality: it is your money that you can spend (even if you borrow some at times), you need to make sure you don't spend more than you have at your disposition at any point in time. Life's a !!!!!.

eskbanker

The question of the week near the foot of this week's weekly MSE email answers a slight variation on this question, naming a couple of basic accounts with cash cards rather than debit cards, aimed at preventing excessive withdrawals. However, I believe they don't offer overdrafts, so probably not really what you're actually looking for!

pimento

Hm. This is for my recently graduated son who banks with HSBC. When he had a student account they managed to stop him going over his limit but now he's a graduate, the account has changed and they are walloping him for every transgression meaning that this month he has accumulated £150 of charges despite being back in credit at the end of the month and never goinf more than £5 over his limit (£200).

He's had the process explained to him (by me - who was the same at his age) and he has now signed up for text alerts but I know even they only arrive the day after.

Any suggestions that don't involve the words 'suck it up'?

TonySoprano

Halifax do an account with control it costs a tenner am month I signed my son up after he was getting hammered for charges. Ok its a tenner but for someone who does not have a grip of their finances it can be much cheaper in the long run. This account also allows you to have a zero overdraft and does not authorise payments if your account does not have the money saving you DD charges

Im still looking for better (without a charge) if anyone knows

pmduk

Suggest he notes his own transactions as and when makes them?

Escorcio

pimento wrote: »

Hm. This is for my recently graduated son who banks with HSBC. When he had a student account they managed to stop him going over his limit but now he's a graduate, the account has changed and they are walloping him for every transgression meaning that this month he has accumulated £150 of charges despite being back in credit at the end of the month and never goinf more than £5 over his limit (£200).

He's had the process explained to him (by me - who was the same at his age) and he has now signed up for text alerts but I know even they only arrive the day after.

Any suggestions that don't involve the words 'suck it up'?

He won't be receiving overdraft charges for going less than £10 over his limit

pimento

pmduk wrote: »

Suggest he notes his own transactions as and when makes them?

Yes, I've suggested this. I've also suggested he installs the app and checks his balance before he buys stuff online or uses his card for cash/purchases.

I was exactly the same at his age and always ran my overdraft to the limit. Way back then there was no online spending though so it was easier to keep a track using a chequebook.

pimento

Escorcio wrote: »

He won't be receiving overdraft charges for going less than £10 over his limit

You're right. Having looked at his statement he was going more than £10 over each time.

He's an idiot and the bank are just doing what banks do.

pmduk

He's more likely to learn in his own time by having to clear up his own mistakes. I know I did. Perhaps you should suggest he calculates just how much he "wastes" by paying bank charges. It might be a sobering thought.

Remember, using a bank's own app may not reflect card transactions that haven't been presented to a bank yet. I use Financisto to record transactions as I make them, though there are lots of others available.

innovate

pimento wrote: »

I was exactly the same at his age and always ran my overdraft to the limit. Way back then there was no online spending though so it was easier to keep a track using a chequebook.

I was there way back then myself. You are right, no online spending back then - but still plenty of ways to spend before we saw any statement. Which we got once a month by snail mail. We had no way to check our bank balance more than once a month, short of going into the Branch.

It's massively more easy to check your bank balance today ( mobile apps and all that), but nothing is 100% real time. So it still remains with the account holder to ensure they do not spend more than they have. If your son has to learn the lesson by being stung with massive overdraft charges, so be it. But hopefully he's a bit smarter.

You kept track of your spending in your cheque book. He could do the same in some app or other. Or on a piece of paper / in a little notebook / in a spreadsheet.