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Day 270: How to get rid of your overdraft, step one


Sleepover with the Operation Overdraft Decimation Nation!
I can braid your hair, then we'll do our nails. Then we can talk about boys.

Wow, so circumstances are really conspiring to help me out with OPERATION OVERDRAFT DECIMATION. First my bestie Gail posts exactly what I need to do, and now Andrea at So Over Debt is offering advice on how to get rid of your overdraft.

Since I don't have the perspective of "how I got rid of my overdraft," I will offer instead a first-person, present-tense account of "How I am getting rid of my overdraft."


Step One: Re-frame how I think about overdraft in my brain.

Today, I had a little quasi-epiphany (quasipiphony) about overdraft. See, I very, very rarely use my credit card to buy stuff because I know I'm trying to pay down that debt (... and also, my credit cards are mostly maxed out). I usually pay for things using debit and/or cash.

But today's quasipiphony was that OVERDRAFT IS THE SAME AS CREDIT. It's not like cash. It's FAKE MONEY. It's BORROWED MONEY.

So, step 1 in getting rid of your overdraft is: realize that it's not the same as money.

Or maybe that's step 2. Step 1 was, I think, realizing that I need to get rid of the overdraft altogether.


jesspoole said...

I believe you also had this same epiphany on Day 221...
You don't need 3 months to get rid of your overdraft! Cancel it now, and if you NEED something, use a credit card, because that will be cheaper than paying overdraft fees for 3 months. Your interest payment on your credit card won't change that much if you throw another $50 on it.
I need you to get rid of this overdraft! I am also working hard to pay down debt, and I want you to succeed too! But your overdraft is like a drug addict keeping cocaine in their sock drawer, if it's there, you will use it!!

Katy P said...

Yeah, but the problem with throwing things on a credit card is that it's still spending more than you earn; it just prolongs the inevitable. You'd be swapping one type of credit (overdraft) for another (credit card). If you're spending more than you earn, you either have to a) find a way to make more money to afford the life you want, or b) start the ruthless cutting. Plain 'n simple.

Dude if it was me I'd get rid of it so that the temptation was gone and follow Gail's plan for the next month. If it feels like punishment - it kind of is. But Ann, you can do can totally do it. It's just a month to get on track, plus another month if you need the time to make it happen.

Serendipity said...

I agree with Jess and Katy. As harsh as Gail's plan is, you need to do it. You need to stop buying clothes and makeup that's not within your budget and do it. Still leave yourself some fun money in new budget but after it's gone, it's gone. No more shopping if you don't have the money!

I really want you to succeed and do well friend so I'm sorry if anything comes out mean or harsh, but this overdraft nonsense is killing you and your better than that.

Lindy Mint said...

It's those quasipiphony moments that make all the difference. When I realized I could actually use my emergency fund for emergencies, and not my credit card, life changing.

Rosie said...

You go girl! You're on the right track to destroying your overdraft. I can't wait to keep reading about it.


Andrea @MoneyMastered said...

Realizing it's not free money is a wonderful first step. Just don't get stuck there - keep going! Overdraft is evil and does nothing but perpetuate the "debt is okay" attitude that many of us develop.

jesspoole said...

Katy, I know that it's not ideal to use credit cards, but I meant if she NEEDED to, it would be better there than using the overdraft, cause I know when I looked into getting an overdraft the fees were so high I changed my mind! Sometimes things happen that you didn't plan for! Like tooth decay, not urban decay! haha

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