Colin There are many people that have overdrafts and they might it difficult to repay them. However, there are ways to make it easy to repay overdrafts and therefore it is wise to have a go and see whether you can repay yours.
How are Overdrafts Repaid?
An overdraft will get repaid automatically because it is part of a current account. When money is paid into a current account, the overdraft will be repaid automatically. This makes it seem really simple but there are some potential problems. If your money repays the overdraft then you will not be able to use it for other things such as paying bills and it could mean that you will have to go overdrawn again and this can lead to a pattern of being overdrawn month after month. Some people also avoid repaying their overdraft by opening a new current account and having their money paid in there instead and then there is nothing that goes in to repay it. This is really unwise as it will mean that you have to keep paying interest on it all of the time.
Tips to Find Extra Money
In order to clear your overdraft and make sure that you do not get overdrawn again, you will need to have some extra money to pay in. This might sound impossible, but there are lots of different things that you can do to try to help. It can be wise to start with thinking about your spending and what things you buy. See whether you are able to buy cheaper items and then you will not spend as much money but you will not have to go without. So, compare prices on things you buy but also ask yourself whether you really need the items This might slow you down and encourage you to cut back on some of the things that you are buying and therefore you will spend less. You may also want to think about whether you can earn more. If you have time you could look for extra work, such as a weekend job, but otherwise you may want to see if there are ways you can make money from home. You can consider looking for some online work, perhaps freelance work or you could think about whether It might be possible to monetise your hobby. It can also be a good idea to think about whether there is a way you can make money form your home, perhaps renting out space for people to store things, or renting your driveway or even a spare room. There are lots of different things that you can try.
Tips to Avoid Getting Overdrawn
It can really help if you can avoid getting overdrawn too. Obviously, the above measures will help a lot, but it can also be good to make sure that you keep a close check on how much money you have in the account. You will then be aware of when you are close to going overdrawn and it might change the way you decide to spend your money. You might cut back or leave buying things until after you get paid etc. Just making a few changes can make a big difference so keeping track is really important as it can motivate you. You might try a bit harder with comparing prices or buying less to make sure that you do not go overdrawn. It might feel a bit stressful but actually being more in control of the situation can really help to reduce stress levels and so it could actually be really helpful.
