Current Account, Overdraft and Cheque

flaneurs_lobster

I've just sent off a paper application form for a regular savings account with an attached cheque for £500. The current account that I have a cheque book for rarely has a balance of more than a few tens of pounds.

I could now shift £500 to this account in the expectation that the cheque will be presented at some time in the next week.

Or I could opt into an arranged overdraft on this account (I've been offered £5k) and hope that I could shift in funds on the same day that my cheque hits the account and avoid interest charges.

No experience of overdraft use and little of cheque clearing. Is this a sensible way to keep £500 earning 5% for an extra week?

wmb194

https://forums.moneysavingexpert.com/discussion/6652462/current-account-overdraft-and-cheque

Yep, use the overdraft. This is what I do in these situations. I check my main account everyday plus have app alerts so I'm not worried about not noticing it's been paid.

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/81857162#Comment_81857162

Can't remember the last time I was overdrawn, can I assume that as long as I add funds to the account to clear the overdraft before close of day then no interest is payable?

Woodstok2000

Seems like a faff for 50p.

wmb194

https://forums.moneysavingexpert.com/discussion/comment/81857175#Comment_81857175

Define, "close of day." It depends on the bank so you need to check the T&Cs. Some will send you a warning text that includes the time. I always add the needed funds in the morning so never need to worry.

UKX69

https://forums.moneysavingexpert.com/discussion/6652462/current-account-overdraft-and-cheque

The quickest I’ve had cheques clearing is 2 days, but that was with a stockbroker. I believe it is quicker with banks these days anyway. Not sure about building societies but some are quite slow.

Rob5342

Your plan should work, but it's only going to earn you about 47p. There are other ways to earn much more than that.

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/81858158#Comment_81858158

Please tell me how to make more money with £500 in a week where the method is

1. legal
2. doesn't involve a bookmaker or a casino

Rob5342

https://forums.moneysavingexpert.com/discussion/comment/81858751#Comment_81858751

I didn't mean with the £500, but if you switched a utility using TopCashBack or switched a bank account for the bonus you could get vastly more for little extra effort.

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/81858889#Comment_81858889

Oh I see, like the £450 from TSB/Lloyds that's incoming and the £500 I made from eToro this month and the £100 from IG Index? 😊

Just looking after the pennies….