Support for overdraft please!

[clouds87]

firstly, this isn’t meant to come across judgey of anyone with overdrafts, it’s asking for personal advice.

So after a very tough year or so - I lost my Mum in Feb 2024, I had a realisation in October/November I’d been spending money randomly to make me happy/full a void. Anyone whose been in similar position might understand, it’s a temporary fix, anyway I decided I needed to stop.

I’ll add I’ve never had to have an overdraft but November I needed to. And each month now I keep going into it. I have £600 overdraft with one bank and £300 with another. I know this might not seem much to some or loads to others but I just need some advice and a kick to help clear it please!

Bit of background for context, I’ve always worked since leaving school, saved up half of the deposit for a house with my long term partner, we have a joint account for mortgage/bills and separate accounts. We have been in our house for ten years.
Over the years we have both earned similar so our money in our separate accounts is our own to do as we want. We are both on under £30000 salaries.

The thing I’m so upset with myself about is over the last nine years, we have both saved up separately to overpay some of the mortgage each year. I can’t do my part of that this year.

Not overly sure what I’m after here, just some advice on how people have got themselves out of a overdraft ‘hole’
thanks

Don’t beat yourself up. Shit happens.

How to get out of debt. Look at all your outgoings, if necessary write down every penny you spend. That will have a two fold effect, firstly, as you are accountable for each penny you won’t spend as much. And secondly, you can see where your money is going.

Aim for a sensible, and sustainable, repayment. Won’t take long to improve. Good luck

Don’t beat yourself up, OP. Most of us have been there! As PP said, look at all of your outgoings. Every. Single. Transaction. You’d be surprised how much you waste - I was! I found that reducing my overdraft by even £10 a month was an achievement. I did it on payday, so the rest of the month I had to tighten the purse strings. Try it with the overdraft with the higher interest rate. Good luck!

I got into this position once with an overdraft AND a credit card. Most of us have been there

sound like you don’t have any other debt and could get a loan? Yes they'll be interest but it will surely be less than your overdraft

only way I could do it was cancel my overdraft and credit card and just pay the loan repayments

you've been doing great overpaying your mortgage , you can pick that up again in 12/18 months time when you’ve cleared your debt

Oh OP! 💜

This stuff happens. Think of all the awful, addictive things people turn to to deal with grief. Gambling, alcohol, drugs… in the grand scheme of things spending frivolously on bits here and there that spark a little joy is not the end of the world.

Sounds like the last 8 years you’ve done really well overpaying, and missing a year is also not the end of the world! Might your partner also like the guilt free experience of putting his overpayment towards something he wants instead this year? It may lessen the blow for both of you if it’s a joint ‘year off’.

In terms of getting back on the wagon again with controlled spending, you sound like you know HOW to be financially responsible already - you just need to keep reminding yourself of your goals and find new/cheaper things to do to deal with your grief. I’d give yourself a little leeway per month so if you ‘fail’ it doesn’t break your streak either. Make sure you have a budget (even if you didn’t used to need one) and celebrate the small wins of not touching the overdraft/building back those overpayment savings as you go. Good luck x

Rather then quote individuals…all this advice is what I needed to see written down.

As of tomorrow:

-paper on fridge so it’s in view: write down every penny of spending

-reduce overdraft by £10 each payday

-take £20 cash out a week for hobbies, this is £10 for a lake swim and £10 for coffee/cake on a weekly bike ride. These are my main hobbies which I’ve taken up - mentally they really help so I’m not willing to give them up! I’ll have another £20 on the odd chance I do something else,

-not stress about a overpayment! As above someone said I can do that next year.

-I’ve never gambled, smoked and don’t like alcohol as someone pointed out, grief for me could have taken me down a different path.

Now this has all been said and I’ve made a list I’m already feeling more positive

Thank you everyone x

I tip I heard on a radio show recently when you are regularly in your overdraft id to change your direct debits to just before pay day if you are charged for your overdraft as you will have more of the month with a smaller overdraft.

Overdrafts can be one of the more expensive forms of credit so it might be worth reaching out to a free debt charity to discuss if there was cheaper forms of credit you could utilise and to get advice on minimising the use of your overdraft and the charges.

It is the cash expenditure you need to record manually, because you don't get a statement.

For all card payments and similar (PayPal, phone apps, etc.), print off the statements or transaction lists each week or month and write next to each transaction what it was for. Keep till receipts so that you can identify each one.

Categorise every expenditure. Have just a few categories, e.g. bills, essentials, and treats.
Then add up how much you have spent in each category.

This will also force you to think about whether you categorise each thing as an essential or a treat.

Sorry to keep going back and forth in here - shift worker!

I’ve found my bank cards so I won’t use my phone to pay now - just had a look back and i didn’t realise how easy it has been to just pay with my phone and waste money - all the odd bits really do add up..

over the next week I’ll looking into changing the direct debits and printing off statements to categorise 👍

Read Martin Lewis on overdrafts. https://blog.moneysavingexpert.com/2018/11/martin-lewis--are-you-an-overdraft-prisoner--how-to-escape-it/

I agree with PP, you may find a bank loan is cheaper. If you get a bank loan you will be tied into a repayment schedule. This maybir may not be desirable to you? If you genuinely can’t see where you could make savings, then the added pressure could be stressful. But on the other hand, the discipline of a repayment schedule might help?

@clouds87 how much is your overdraft interest? I'm sorry but I don’t think reducing it by just £10 a month is going to make any difference at all

do think about looking for a cheaper loan and using the money you are currently overpaying to help fund the repayments

Have you talked to your partner about this? It sounds like he has some money saved up for his part of the mortgage repayments. It might make more sense to use that money to pay off your overdrafts. It doesn’t make sense to me for you to get a loan when there is money that could potentially be used. This would mean that you’re then in a position to start saving again towards the mortgage overpayments (which you wouldn’t be if you’re still paying off the overdraft or a loan) and you could agree that you try and save extra to cover his portion or pay him back what you’ve borrowed from him.

This may not work for you if you’re very definite about you each having your own money but if you are in a long term partnership you should at least be able to have the discussion.