Overdraft charges

[Dancingqueen90]

Advice please...

I am constantly in my over draft and in time will clear down. I am trying to save a bit each month to pay for the expected / unexpected (kids club / aftercare / car expenses etc )... and prioritising clearing credit card debt down over the next 12-18 months.

Anyhow I have a big bill coming up and having read through other threads about pots and putting money in I thought I would be pro active and stick the money in my savings account now and put it back when the bill is due in a few weeks. However the daily OD charges made me realise it will cost me alot to do that so have to keep the money in my current account. So I have had to make a mental note to myself of not letting my balance drop below a certain amount so I have enough to cover the bills.

I would like to move to a bank where I can use the pots but my overdraft is a blocker I think....well for the time being..

Is there anything I am missing?

As ever, Moneysavingexpert is your go to for stuff like this.

Problem with overdrafts now is that the interest rate is very high, usually a lot more than credit cards, so you need to make it a priority to pay off, even before credit cards.

A good review of your budget is always helpful, to see if you can cut your spending to free up money to pay off the OD. It could even be worth having a period of extreme frugality, buying nothing that isn't essential, to get rid of it.

Alternatively see if you can transfer the debt, either directly or indirectly, to cheaper borrowing, eg using a loan, or a money transfer credit card, or if you get an interest free spending card, put normal expenses on that, so the money stays in your account that gets overdrawn, and reduces the interest you pay. However, you need to be disciplined and not see this as 'free money' and use it as an excuse to spend, or else you'll run up credit card debt, and the OD will still be there

Have a look at www.moneysavingexpert.com/banking/cut-overdraft-costs/