Current accounts where savings offset overdraft

phil1111

We use several accounts with the same bank to manage our budgeting, with money for different purposes in different 'pots'. As a result, our main current account sometimes goes overdrawn for maybe a week or so, even though we have money in the different savings accounts that more than balances it out.

This worked fine until the interest rates for authorised overdrafts were hiked up. Now this is going to cost us a lot over the course of the year. We cannot just sweep from one or other account - we need to work out how much needs to be transferred from different savings accounts and that's something that takes more than a few minutes.

So my question is, does anyone know of a bank that will offset any overdraft balance with the savings balances? I think Starling do this, but app-only banking doesn't appeal, compared to the nice big screen of a laptop. We don't need a bank with branches, so long as Internet banking works on a computer!

Thanks for your recommendations!

colsten

I don't think you will find what you are after. Have you investigated an interest-paying current account instead?

Generally speaking, it is not very money-saving-expert to use an overdraft if you have savings. Overdrafts are one of the most expensive way of borrowing money, and savings accounts pay you a tiny fraction of the interest your overdraft costs.

Dobbibill

I'm not aware of any accounts that do that - someone more knowledgeable may come along soon with suggestions.

Now may be a good time to review your budget and look at adding a buffer to your current account.

trailingspouse

By how much do you go overdrawn each month?



Transfer that amount from your savings account to your current account.

DCFC79

Why do you go overdrawn ?

Work out how much your going for the following month and add a little more to it each month say £100. Once it gets to payday you can sweep some into your savings pots.

Maybe you need to budget better.

Jami74

phil1111 wrote: »

We cannot just sweep from one or other account - we need to work out how much needs to be transferred from different savings accounts and that's something that takes more than a few minutes.

Why can you not just sweep from one or other account? As important as it is to save, avoiding overdraft fees is probably more important.

As boring as it sounds, one of my spreadsheet tabs is a running projection of my main current accounts. As soon as I know the amounts and dates of outgoings I add them in and it instantly shows me what day and by how much I'll go overdrawn. Then I transfer that amount from a savings account into current account. Once more funds have gone into the current account I can see how much I can transfer back to savings without going overdrawn. Doing it this way means the current account rarely has more than a few pounds in it, yet never goes overdrawn.

Sea_Shell

Hmm.

A little bit of time spent moving money vs. overdraft fees?

No brainer, surely?

SnowTiger

Why not use a current account that pays interest. TSB Classic Plus for example. 3% interest on (up to) £1,500.

Marcus seems to be the highest paying normal savings account with an APR of 1.5%. That's only £15 interest a year for every £1,000 saved.

If the OP already has an account and setup they like that offers pots, etc, perhaps an easy option would be to stick with that system and keep some of their savings in their current account.

Not very MSE, but interest rates on savings are extremely low and would easily be dwarfed by overdraft charges.