That feeling of being stuck in an overdraft is never a good one, it can feel like a never-ending debt that just really needs to be wiped off your bank balance. Here are 5 essential steps to overcoming your overdraft and turning that – into a + balance.
- Putting your rent, bills, and any recurring outgoings aside
When payday comes around, before spending any money, set aside your primary outgoings that need to be paid. You can put them into a different account if you get tempted to spend them. Now you will be left with your monthly budget, divide this by 4 and you have your weekly budget (this is for those on a salary who get paid once a month). Now you have your living costs set aside and organised, if you can afford to also set aside a certain amount every month to pay off the overdraft. Even if this is a small amount, it all counts, the most important fact is you’re paying it off not going deeper into the overdraft.
- Minimising overdraft interest charges
If you are getting charged for your overdraft and you find yourself in an emergency situation, you can always find payday loans options to cover your costs if you have completely run out of money. These are only recommended if you know you can pay them back in the future. Some pay their overdraft off with a loan as the charges incurred are cheaper but this completely depends on specific loans and banks so research wisely and read the terms and conditions.
- Cutting your eating out costs and learning to cook
If you often eat out and order takeaways now is the time to start cooking and spending your food budget in a more cost-effective way! This will not only save you money but it can also teach you healthy recipes that will make you feel great. It takes a few minutes to google a recipe and making food for yourself is good fun, however, it isn’t for everyone but there are some simple options that will be much cheaper than opening up that Deliveroo app.
- Changing your mode of transport if you can
In the long run, it can be cheaper to invest in your own personal transport if you know you need to use it every day to get to work. If you take the bus or train, you could think about purchasing a bike to get from A to B. This is also an excellent way to keep fit. The weather is a deciding factor in this one, in the colder months you might prefer to travel by bus, but you could do both and probably still save money here.
- Stay in on the weekends instead of going out to splash the cash
Well, you probably will want to have a treat most weekends but it’s wise to try and stay in where possible. You will escape the hangover and your wallet will also thank you. Swap the tequila shots for some popcorn and a few beers at home.
Once you get started with paying what you owe back, you will start to see the light at the end of the tunnel and it will seem more achievable. Good luck with paying off your overdraft and you can enjoy life to the maximum when you know you are finally in plus figures!
