How to Avoid Going Overdrawn

Henry Richards By Henry Richards, 10th Dec 2012 | Follow this author | RSS Feed | Short URL
Posted in Wikinut>Money>Current Accounts

A selection of things people can do which might help them avoid going overdrawn on their current account.


Going overdrawn on your bank account generally costs you money at a time when you can least afford it; you run out of money in your current account and you have to deal with overdraft interest charges or fees.

There are however a selection of things you can do which might help you avoid going overdrawn in the first place.

Direct Debits and Standing Orders

One of the most common reasons for people going overdrawn is badly scheduled direct debits and standing orders. Ideally all your direct debits and standing orders should leave your account soon after you are paid.

If you are in this situation contact the recipients of the payments and arrange to have your payment date moved. You'll typically have to pay for amount of time you want to shift the payment date by: move it my 1 week and you'll have to pay 1 weeks' worth, but you do get the extra one weeks' worth of whatever you're paying for.

You may also be charged an administration fee for moving the date. And in some cases the recipient may just refuse to allow the date to be changed.

Tracking Your Balance

Constantly knowing how much cash is in your account can really help you to avoid going overdrawn. If you notice your balance is getting low and you're in danger of going overdrawn the more time you have to figure out a solution the better.

Mobile banking apps can be one of the quickest and easiest ways to keep on top of your balance.

Phone banking also allows you to check your balance when you're on the go. Some banks even offer text banking services which send you a message when your account hits certain minimum or maximum balances set by you.

Online banking can also be very useful and you can always check your balance at a cash machine.


Do some simple math to figure out how much you have coming in and going out over the course of a month. If you're going to have a shortfall, the sooner you find out the better; you'll have more time to tighten your belt and save cash. You'll also have more time to try and make some extra money.

Using a Buffer Amount

A really good way to avoid going overdrawn is to try to always have a cash buffer in your account. This basically means deciding on a certain amount of cash you always want to have in your account and doing your best to avoid going under it e.g. you could decide on a buffer of £100 and strive to keep your balance above that.

Overdraft Protection

Some banks offer overdraft protection services. Typically these involve linking your current account to a savings account. If you are going to go overdrawn your bank will automatically transfer enough cash from your savings account to your current account to cover the shortfall.

Before signing up to an overdraft protection service make sure to work out if it's actually worth it. Many banks will charge a monthly fee for the service and some charge a fee each time money is automatically transferred.

Your Tips

Do you have any tips to help avoid going overdrawn? If so, we'd love to read about them in the comments section below.


Avoiding Charges, Banking, Current Account, Money, Overdraft, Overdrawn, Personal Finance, Planning

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author avatar Henry Richards
This blog is run by a bunch of people working for a digital agency.

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