Not been running my current account right!

pd52

I have a Lloyds current account, flexible personal loan and credit card (choice rewards - use it for all spending during the month for the points! )When I get paid on the last working day of the month all my DD's go out, i pay my credit card off in full usually about £400, put some in my Lloyds ISA and Im left with around £450 spare that I then use to over pay my loan.

So my current account is at ZERO all month. I thought I was doing the right thing but obviously not, Lloyds think I have no money at all when I get paid :eek:

Should I keep the £450 until the next pay day every month then over pay so my current account always has a £450 balance? would that work ?- not sure what the banking dates are month to month, 2nd to 1st?
Also do the same with the money Im putting in my ISA?

YorkshireBoy

pd52 wrote: »

not sure what the banking dates are month to month, 2nd to 1st?

Nearly. 2nd working day of the month to the first working day of the next month.


I wouldn't get hung up on no money being in your account by payday. Your money needs to be where it is working hardest for you, ie minimising loan interest and maximising rainy day fund savings account interest, as early as possible in the month.

pd52

YorkshireBoy wrote: »

Nearly. 2nd working day of the month to the first working day of the next month.


I wouldn't get hung up on no money being in your account by payday. Your money needs to be where it is working hardest for you, ie minimising loan interest and maximising rainy day fund savings account interest, as early as possible in the month.

Ah right, thanks. When I was in branch a while back I was told it didn't look good being on nil, at the time I wasn't to bothered due to the reasons you mention above. I also put money in to a tesco internet saver via DD at the beginning if the month- only £10 a month tho

TartanSaver

Does it even pay interest? Why should you care what your bank "thinks"? Between your loan, which is making them money directly, and your ISA which is paying you a pittance in interest, they're doing very well out of you. They won't rock the boat. Once you have a rainy day fund of a couple of month's pay, I'd focus everything on overpaying that loan.

Tesco internet saver rate is terrible. You could open a TSB classic plus, put your savings in there for 5%. At the start of the month transfer £500 in and out of it before you make your loan overpayment to meet the funding requirement.

You're on the right track with those overpayments already. Good luck clearing the loan.

SnowTiger

pd52 wrote: »

Ah right, thanks. When I was in branch a while back I was told it didn't look good being on nil, at the time I wasn't to bothered due to the reasons you mention above. I also put money in to a tesco internet saver via DD at the beginning if the month- only £10 a month tho

It only, perhaps, affects your internal score with the bank.

Current account balances aren't reported to CRAs. Well, none of mine are. Overdrafts generally are, though.

You mention putting money away in to a Lloyds ISA. What interest are you getting on your savings? Less then 2%? You might be better off switching to an interest paying current account. Lloyds, itself, offers one.