Are you charged if a standing order to one of own accounts makes you overdrawn?

cashmonger

I have a work/income current account and living expenses current account.

I accidentally forgot to transfer the money from my work account to expenses account (where the rent comes out) making me overdrawn by under £10.

So I would like to prevent that and automate the process in future.

I am self employed and earnings vary quite a bit month to month (although things are getting better still it can vary) so that is why I had been hesitant to make a standing order when I wasn't sure how much money was flowing month to month.

But will I be charged if I did set one up and forgot to check and it did cause the one to get overdrawn when transferring to the other of my own accounts? I would like to think not if it's your own accounts but I wouldn't put it past banks to get some extra easy fees out of you.

I am just wondering what the best way is to make sure the expenses account has enough in there to avoid going overdrawn on either.

I do check my accounts but not that much. Just wondering what the best way to deal with it is to avoid the issue I had of going overdrawn while keeping it hands free.

I know it's good general practice to keep an eye on your accounts but I just do not do it with much regularity.

eskbanker

I don't believe that the fact of transferring between your own accounts would give you immunity from any charges applicable to insufficient funds, but if you're unable or unwilling to keep on top of what's in your accounts then why not just use one account for everything instead of trying to keep two in step?

cashmonger

Na seperation is much better for work purposes to see only ingoings/outgoings related to work in that one account.

I will just remind myself to check them more often. I have setup a standing order for next month's rent so I'll see how it works out.

msallen

Of course it doesn't exempt you. Why would it?

Otherwise you could set up an SO from account A to account B in order to avoid B going overdrawn (and thus avoid fees on that one) but which made A overdrawn.

eskbanker

cashmonger wrote: »

Na seperation is much better for work purposes to see only ingoings/outgoings related to work in that one account.

Ah yes, I'd missed the significance of your self-employment, so it would indeed make sense to use a separate account for that. Having said that, do the Ts & Cs of the account you're operating allow its use for business-related purposes, as most (if not all) personal current accounts prohibit this?

pmduk

If you do get charged and it's the first time, a friendly call to customer services will often get the charge waived.

gt94sss2

Are the two accounts with the same or different banks?

Transferring money to yourself does not mean you won't charged but if the accounts are with the same bank, the bank can use their right of 'set off'

Also, worth checking the charges in the account which went overdrawn - some banks don't charge for some overdrafts (or have a free buffer) or if it's put right the day it happens.

glennevis

If your bank offers free text and/or email messages when your balance drops below an amount you define then set up an alert. That would give you chance to rectify the shortfall asap next time it happens.

Westie983

Hi,

It depends on the bank if they will charge for bounced DD or SO.
Many banks now have a cut off of around 2/3pm to enable you to fund the account before it is bounced. Many banks will then try again each day of the funds are there, but only for Standing Orders DD will need to be contacted and paid another way.

For example my TV licience failed this month because it was 4p overdrawn and it bounced as I didn't notice, I will have to pay two lots next month and it won't try again as it was a DD.

Westie983