Which is better - unplanned overdraft or cancelling a dd??

rachaelsmith82

Hi,

I have misjudged my budget this month and do not have enough money to pay a bt direct debit coming out tomorrow!

I am getting paid on Monday so can pay it then but would like some advice.

Is it better to cancel my dd now before midnight so bt don't try to take and my bank reject and occur fees etc or is it better to let them try and just pay it Monday?

I am thinking better to cancel dd and then contact bt tomorrow to tell them I can pay Monday?

Am concerned if go into unplanned overdraft this will have impact on credit rating etc....

I am with lloyds and payment is for £47 and not missed a payment for years

Any help much appreciated!!

gt94sss2

Can you apply for a small overdraft online (i.e. so it becomes planned rather than unplanned)?

rachaelsmith82

I already have £100 planned which I would be going over!

[Deleted User]

So make it £200, takes seconds online

jimjames

It won't help for this month but I'd really recommend that you build up some emergency savings so that a bill of £47 isn't something that causes you to have financial issues.

Shakin_Steve

jimjames wrote: »

It won't help for this month but I'd really recommend that you build up some emergency savings so that a bill of £47 isn't something that causes you to have financial issues.

Whilst your advice makes perfect sense, Jim, I guess we have to realise that £47 is make or break for some people. I get quite complacent these days but, if I think back to various times in my life, there's been days when £47 would have been very welcome.

eskbanker

Similarly not helpful this month but BT aren't renowned as being the cheapest provider of many things, so if things are tight, shopping around may buy some headroom, depending obviously on what OP is buying from them and on what terms....

ani*fan

I just wanted to add that you were too late to cancel the dd and therefore your only choice was to apply for an overdraft increase online or else go into unplanned overdraft for 1 working day.
How did it work out for you?
Yes an emergency fund and a cheaper provider would have helped long term, but not what the OP was asking at all.
😊

grumbler

Shakin_Steve wrote: »

Whilst your advice makes perfect sense, Jim, I guess we have to realise that £47 is make or break for some people. I get quite complacent these days but, if I think back to various times in my life, there's been days when £47 would have been very welcome.

Well it's a phone bill FGS, not just £47. I have a lot of savings, but I never pay that much for a phone.

eskbanker wrote: »

Similarly not helpful this month but BT aren't renowned as being the cheapest provider of many things, so if things are tight, shopping around may buy some headroom, depending obviously on what OP is buying from them and on what terms....

And, possibly, stopping buying some unnecessary things, at least until reasonably big savings are built.

With regard to acting in the given circumstances, it's usually better and cheaper to cancel the DD and, possibly, keep paying manually until you have some savings. Balancing on the edge of an overdraft, even approved one, is never a good idea.

iammumtoone

grumbler wrote: »

Well it's a phone bill FGS, not just £47. I have a lot of savings, but I never pay that much for a phone.

You don't know what they are paying £47 for, a phone is probably included but will include other things as well. Maybe there are tied to a contract taken out before they got into money difficulties.

grumbler wrote: »

And, possibly, stopping buying some unnecessary things, at least until reasonably big savings are built.

Again you have no idea what money the OP had to budget with and what they spend on, they may not be buying unnecessary things.

amanita

Just a note for the future, if you're rejected for overdraft increase online a lot of the time it'll be approved on the 'phone. I was told this by a hurt sounding Lloyds employee when i cancelled my Club Lloyds because I moved my salary elsewhere because of a similar rejection!