Second Bank Account or Prepay Credit Card?

Pink_Giraffe

I keep trying to budget and I'm having to be more strict with myself because I tend to overspend when I get paid. I have a couple of debts which I have repayment agreements on so my credit rating isn't great. What I want to do is have my main bank account for my salary to go into and all my essentials/regular bills to come out of and then something else for my "pocket money".

My question is, as my credit rating is poor, would it be better to set up a second basic bank account, and if so, what banks would people recommend? I don't want an overdraft but I will need a debit card and online/app banking. Or, would it be better to have a prepay credit card, which I've heard can boost your credit rating but I'm sure will carry a charge? Does anyone have experience with these and are there any in particular I should try/avoid?

Thanks in advance!

grumbler

Generally, prepaid cards don't boost the rating. There can be a few that do, but they will charge you a lot and hardly worth wasting money on them.

IMO, a basic account is a better option if it comes with a debit card and doesn't allow you getting overdrawn.

Pink_Giraffe

Thanks for the advice. Is there any benefit to having my second account with the same bank as my main one, or should I shop around? Is there an up-to-date thread anyone can direct me to with suggestions, I can only find one from 2006?!

grumbler

It's easier to manage accounts if they are with the same bank, but generally it's recommended to have accessible money in at least two banks.
For basic accounts see Basic Bank Accounts - Top accounts for poor credit scores
For full accounts - Best Bank Accounts

Pink_Giraffe

Thank you, much appreciated! Also, I'm a big fan of your signature.

eDicky

Regarding prepaid cards, the only one that supposedly can improve your credit rating is Cashplus, but it will cost you quite dearly and the effectiveness is doubtful.

Monzo would cost you nothing, although you need to load an initial £100 to get your card. Transactions appear instantly on the app and are itemized as groceries, transport, etc, so it may assist your spending control. To jump the queue, sign up via the link in the MSE article:

http://www.moneysavingexpert.com/credit-cards/prepaid-travel-cards?&_ga=1.84728985.1890557612.1491209387#monzo

Loot is similar, and has a 'goals' function:

https://loot.io