Not being overdrawn

WhenIam64

I do owe on my credit card!

Work in an area where I have to look past the words to the facts. Can't understand why a "credit" card has such a misnomer when it is a basically a high-interest debt card.

You might want to check the difference between running up "credit" on a credit card versus the overdraft.

EssexHebridean

Shashwoo wrote: »

This type of thing astounds me.... I'd never heard of it until recently.
We have a joint account and it has a £300 OD on it, there are no charges for using the £300 and it is a safety net only.
I cannot fathom when people say they have a massive OD.

But then I can't fathom people who smoke, drink to excess, or borrow for home improvements or weddings etc rather than saving for them - we all differ in financial matters I guess, and different people see the "danger levels" differently. Thousands of debt on CC's would scare the life out of me unless I had the money in savings to offset (A situation I am about to be in again - as 0% borrowing and interest paying savings make a lot of sense!), but others turn up on here utterly un-phased by that sort of level.

I think things have changed a lot on the OD front recently as well - although we were sometimes £500 or so in by the end of a month we never paid more than a bit over £1 in fees any one month as it was an agreed OD. Now in some cases people would be paying 50 x that amount for the same sort of level - or indeed even more. We'd have got to grips with things a lot sooner if the charges had been at that level for us!

chelseablue

WhenIam64 wrote: »

Work in an area where I have to look past the words to the facts. Can't understand why a "credit" card has such a misnomer when it is a basically a high-interest debt card.

You might want to check the difference between running up "credit" on a credit card versus the overdraft.

The balance on it is 0% until January 2021

EssexHebridean

chelseablue wrote: »

The balance on it is 0% until January 2021

As I said in my reply above - 0% borrowing + interest paying savings = a win. "Owing on a credit card" is not always clear cut, is it!

Sanctioned_Parts_List

WhenIam64 wrote: »

You might want to check the difference between running up "credit" on a credit card versus the overdraft.

Fantastic piece of marketing convincing us that "credit" on the bank's balance sheet occupied the same position on ours.

-taff

I used to live in my overdraft of about 2k, that was about 18 years ago, took me another eight years to work out ow bad that was so then I sorted out my my overdraft, many credit cards, consolidation loan etc. It just takes a LBM...and no one is immune to this, if you haven't got a good amount of savings behind you, you'll get in debt quite easily as one thing go wrong, then another etc etc..

Takmon

I've never had an overdraft and anyone who plans their finances well won't need one. If I went into an overdraft then i would see it as a failure in my finances. I would never be able to happily be in an overdraft every month but I also know some people who seem content with this and one who seems to find it amusing how all their monthly wages only just cover their overdraft each month and they then borrow it all back during the next month until they are paid again.

Alot of people get into this situation because they are slack and let it go on too long. If everyone kept track of their finances and started to take action the first month their outgoings were more than their income their would be very few people getting into large amounts of bad debt.

tallyhoh

I used to work in an office full of people who were into their overdraft the day after being paid. Same people always showing off their latest car or expensive handbags. Don't know what became of them after the redundancies!

chelseablue

Thank you all, very interesting responses

My husband is a bit younger than me (he's 29) and is always saying I should go out and get a new car.
When I say that I'm saving up for one he either says "just lease one" or "just get one on finance"
Drives me mad but I just ignore now :rotfl:

There's absolutely nothing wrong with the car, he just doesn't like it because its 'old'
(Its 13 years old but only done 56,000 miles)

[Deleted User]

I've had overdrafts in the past and once you start using them it's hard to get out of them. I never want one again and it's actually nice to see some money in my account at the end of the month these days rather than it being in a minus.