Ex-Graduate account overdraft, im having trouble clearing

PMKeates said:
OK I am going to explain this very simply. Let's take your situation:

You have £1000 savings. You have £1750 overdraft used, £250 available. Your total cash available is: £1250. At any time you like, you can spend, at most, £1250. If you want to buy a car, you have £1250 to spend.

Let's say you pay off your overdraft off with your savings. DO NOT REDUCE YOUR OVERDRAFT AMOUNT. You have £0 savings. You have £750 overdraft used, £1250 available... recognise that number? Yes, you still have £1250 to spend. If you want to buy a car, you have £1250 to spend. The difference is, each month that you don't spend that £1250, instead of being charged interest on £1750, you are being charged interest on £750. The interest you are charged on that extra £1000 is MORE than the interest you are gaining from having it in savings.

So, please, pay your overdraft off, and do not reduce your overdraft limit. You will have the same amount of cash available, but will be losing less money each month on interest charges. The purchase of a car is a completely separate issue to where you should be saving/borrowing money.
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This guy speaks the truth!
 
ColdAsIce said:
This guy speaks the truth!
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Because if I do this, the money WILL be available in my account, and I will spend it.

Hasnt it occured to you that the reason I havnt cleared OFF this money, is because the money is available to me, hence I spend it again?

Obviously being as smart as you lot are, none of you could work it out.

And before you ask, no, I dont have direct access to my savings.
 
DJMK4 said:
Because if I do this, the money WILL be available in my account, and I will spend it.

Hasnt it occured to you that the reason I havnt cleared OFF this money, is because the money is available to me, hence I spend it again?

Obviously being as smart as you lot are, none of you could work it out.

And before you ask, no, I dont have direct access to my savings.
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Well then you have to realise this.

You are WASTING money by NOT paying off your overdraft.

Unfortunately you will have to show some self control.

Simples.
 
DJMK4 said:
Because if I do this, the money WILL be available in my account, and I will spend it.

Hasnt it occured to you that the reason I havnt cleared OFF this money, is because the money is available to me, hence I spend it again?

Obviously being as smart as you lot are, none of you could work it out.

And before you ask, no, I dont have direct access to my savings.
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Then again ... For the third time ... you are beyond help.

Enjoy living in debt
 
DJMK4 said:
Because if I do this, the money WILL be available in my account, and I will spend it.

Hasnt it occured to you that the reason I havnt cleared OFF this money, is because the money is available to me, hence I spend it again?

Obviously being as smart as you lot are, none of you could work it out.

And before you ask, no, I dont have direct access to my savings.
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Then my advice to you is to hand over your financial affairs to somewhere you can trust. If you are unable to manage them adequately, then you are making bigger problems for yourself in the long run.

Forcibly reducing your net income to punish yourself in to not spending money is like some odd form of self harm. You need to stop seeing the overdraft as your money - it isn't. It's the bank's money that they are lending you, and charging you for the privilege. You seem to be slowly edging towards less debt, so the most important fact is clear: your outgoings are less than your income. You CAN not spend up to your overdraft limit again, but you have to see it as not being there.

You can increase your current expenditure without doing anything other than paying off your overdraft with your savings.

Repeat: you can increase your current expenditure and retain the same net change month on month if you do this.
 
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DJMK4 said:
I am not using my £1k that I have already saved to clear it off. Im sorry, I need that just incase my car goes. As otherwise ill be taking out another loan to buy a car.

What I am willing to do is to reduce my savings down now to say £50 per month to add to my £1k, and then pay £500 on debt, which will take me 4 months to clear.

I am in no position to get rid of that 1k I have saved, as it could be 2 months before my car gives up on me, then what do I have?
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*BANGS HEAD*

dear god man.

You're "saving" hundreds of pounds per month, and at the same time sitting on over £1000 in savings, yet complaining you cant pay off debt and are constantly using your overdraft.

Have you ever considered the reason your constantly dipping into your overdraft and never paying it back is

BECAUSE YOU CANT AFFORD IT.

stop saving money than you have spare and get that debt paid off. Then request the overdraft be cancelled. Job done.

What would you do if you didnt have the overdraft to dip back into ? you'd just dip into your savings instead. Thats the problem - you're re assuring yourself that your doing well by saving, but your putting too much aside and getting yourself further / keeping yourself in debt.
 
Just do whatever you want as you obviously don't listen to advice, that's probably the reason why you're in the position that you are.

Sadly the only problem here is you, not the debt.
 
Uhh.. don't listen to what everybody is telling you to do then if you're not capable of leaving money in the bank. This is a bit painful to read, did you really graduate?

In fact I think you should invest in lottery tickets.

I am Nigerian prince, would you care to invest in Nigerian oil? I just need £1,000 to get the money from a recently deceased relative for some vague reason and you'll quadruple your money in a week. Sound good?
 
oh dear god.

how do you find your way out of your house in the morning?

good suggestion alex tank.

I actually have a large supply of north yorkshire oil that I am willing to sell you for £1000. you can make a huge profit on it. once i have recieved the money i will post the oil to you
 
DJMK4 said:
And make no contributions to my savings?

seems abit daft really

4-5 months to clear overdraft, but then make no contributions to my savings, or

8-9 months to clear, and contribute £400 per month to savings

Savings I need for a car unfortunatly, as my car is nearing 161k on the clock.
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No it doesn't seem a bit daft. You're paying higher interest on your overdraft than you will be getting on your savings. It makes no sense at all, and seems very daft that you're still paying into savings whilst maintaining an overdraft.

Once you've cleared your overdraft, you will be able to save a lot more, and you won't be paying interest to some cretinous bank.
 
Use you're savings to pay off the overdraft and then start saving again, it's basic maths. You'll save yourself the £29 a month interest.

Get a credit card, have that as you're "if my car blows up I'll need some cash" my Barclaycard is only 6.9% APR on all purchases for the life of the balance, which I'd guess is better than the £29 interest you're garanteed to pay on you're overdraft. Obviously this only needs to be used IF you're car does need some work, so theres no garantee you'll have to use the card.

OR apply for a bigger overdraft, but DONT use it unless you need to. My old one use to charge me interest per month if it was used, but nothing if it was not used.
 
DJMK4 said:
IGenerally my other finances are ok, I have £210 disposable income per month after all my outgoings, plus im putting around £395-£400 savings away per month.
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Any financal advisor worth his or her salt will advise you to use your savings to pay all your debt. Then cancell the overdraft forever. You start from scratch, but you'll save yourself £30 a month.
 
MrLOL said:
then cancel the overdraft

You've already admitted your not to be trusted with it. If you cant control yourself, you remove the temptation.
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I would recommend keeping the overdraft but learning how to use it. I used to have more unsecured debt than my entire annual gross salary. I solved that problem by forcing myself to be responsible, not systematically paying off and removing every credit line I have. I switched as much as I could to low-rate/zero rate interest and paid off the highest interest rates first. I currently have about £5k on a 0% credit card (though annoyingly I had to withdraw some cash on it [multiple currency thing], and so I am now paying some interest, just not very much), as short of deflation greater than interest gained on the balance elsewhere, it's free money.

Credit is very useful, and even more available, when you are in the driving seat.
 
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DJMK4 said:
This is exactly what im willing to do! But people didnt notice that

£600 over 3 months, will basically clear
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good man

Get it done (i dont subscribe to the same view as PMKeates), then cancel the overdraft to stop you using it again.

If you really get stuck, you've still got your £1000 savings. And if you get proper stuck, you'll probably find the bank will give you the overdraft back...
 
Ukadder said:
Get a credit card, have that as you're "if my car blows up I'll need some cash" my Barclaycard is only 6.9% APR on all purchases for the life of the balance, which I'd guess is better than the £29 interest you're garanteed to pay on you're overdraft. Obviously this only needs to be used IF you're car does need some work, so theres no garantee you'll have to use the card.
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Don't recommend a credit card in this situation, he already struggles to control his overdraft.
 
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