Nationwide has shared a positive update with its millions of customers, with many set to reap some financial benefits. The world’s largest building society sent an email out on Thursday, November 21, with a change now in place across a number of account types.
Banks typically include overdrafts with their current and various other accounts, though fees are often incurred when these are entered into. Nationwide, like others, often charges for overdrafts.
But this week Nationwide has announced that holders of specific accounts, namely FlexPlus, FlexDirect, and FlexAccount, will no longer have to pay overdraft charges on the first £50 of their overdrafts. Emails from Nationwide advise: “To make things a little easier for people, we have made the first £50 of arranged overdrafts interest-free for FlexPlus, FlexDirect and FlexAccount holders.
“So, if you need to dip into your arranged overdraft in future, this extra little buffer will be there for you. This change has already happened, so you don’t need to do anything.”
Should account holders exceed this £50 mark, normal fees will apply. Nationwide clarified: “If you borrow more than £50, you will be charged. You won’t be charged interest on the first £50 of your overdraft. If you borrow any amount over £50, your usual variable interest rate of 39.9% a year compounded will apply.”
This latest message from the building society comes after members were urged to make a “budget plan” earlier this week. Nationwide added that this should be “personal to you and help you decide what you want to spend, and where you’ve decided to cut back”.
People have been advised to work out their monthly income, go back through statements to see how this is being spent, and then categorise purchases into “musts”, for example bills, and “wants”, such as hobbies and eating out.
An example then given by Nationwide was to then implement a 50-30-20 rule, the idea being you’d aim to spend 50% of your take-home pay on musts, 30% on wants, and the remaining 20% would be placed into savings, or on paying off debts.