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    • Pennypanj
    • By Pennypanj 6th Dec 17, 1:40 PM
    • 6Posts
    • 2Thanks
    Overdraft - Lloyds Daily or Savings?
    • #1
    • 6th Dec 17, 1:40 PM
    Overdraft - Lloyds Daily or Savings? 6th Dec 17 at 1:40 PM
    I am currently living in an overdraft with 2000 by the end of each month. The Lloyds daily overdraft charge is being applied and I hate it...even if I don't spend from my account, the statement shows an amount being taken every day...My first tactic to minimise the fee is to use my interest free Barclaycard for any non-bill spending and to pay the card off one day before payday, using the remainder of my, only being overdrawn to the max for one day.
    My bills come to roughly 1000 per month (including mortgage).
    I have 500 in another account and am getting a bonus for my question is-should I keep a separate pot of savings , or should I use this to reduce my overdraft?
    I like having a separate account for emergencies (house renovation ongoing) but also equally hate the daily overdraft fee!
    Advice very much appreciated!
    Many thanks
Page 1
    • Tarambor
    • By Tarambor 6th Dec 17, 1:46 PM
    • 2,857 Posts
    • 2,066 Thanks
    • #2
    • 6th Dec 17, 1:46 PM
    • #2
    • 6th Dec 17, 1:46 PM
    You have no savings because you owe more than you have cash. You also can't afford your house renovation because you are living in your overdraft. You need to get this overdraft sorted out ASAP as you are in debt crisis. That involves stopping the house renovations, using money you have to pay it down and moving anything outstanding to the cheapest borrowing you can, i.e money transfer credit card.

    Only once you've done that can you then build up a buffer and then continue with the house renovations.
  • National Debtline
    • #3
    • 6th Dec 17, 2:13 PM
    • #3
    • 6th Dec 17, 2:13 PM
    Hi Pennypanj

    Your overdraft presumably accrues interest at a faster rate than any savings you have or are likely to have. You should therefore attack the overdraft as aggressively as possible and if, as tarambor suggests, that means delaying certain (non-essential) outgoings, then so be it.

    Good luck

    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
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