I’m just stunned that Monzo, who check this forum and have obviously read this, have not updated their t&c to clearly state.
They tell us how transparent they are all the tine, but seem to ignore these “facts”…maybe because it’s currently their biggest money spinner…how very bank like! 
(This was flagged…yes really…)
So this £1000 overdraft vs £1000 in goals thing. I thought I was clear on how it worked. Now I’m not. If I’m understanding correctly. I could put £1 in goals and transfer the £1000 from the overdraft into that goal, via whatever means necessary. I will then earn ~£5 a year on the goal value whilst not paying anything on the overdraft because my goal will be £1001 but the overdraft would be £1000? Is that correct?
This is why like the monzo approach. It’s straightforward.
Your account balance would be £1 so you get interest on the £1 not on £1001 because you don’t have £1001 in your account!
With Starling it is so straightforward as it is calculated on your account balance, it is at Monzo it is not straightforward as they don’t use your account balance, they use account balance less the balance of money held in pots, that is more complicated!
The final one is the last piece of the puzzle. You don’t get interest on the part of your goal that is cancelling out the overdraft. It all makes sense now. Until someone says something different of course.
I really think we should give some maths lessons in this thread.
I’ll start:
| on your card | + | in pots | = | total | overdrawn |
|---|---|---|---|---|---|
| -£895 | + | £1200 | = | £305* | no |
| -£500 | + | £250 | = | -£250* | yes |
| -£320 | + | 0 | = | -£320* | yes |
| £200 | + | £100 | = | £300* | no |
* indicates the amount you receive / pay interest on. (@anon44204028 can you confirm if I got that part right? It’s the one part I’m not clear on, given I don’t use Starling)
Simple, no?
It’s simple once all the info has been presented. Previously it hadn’t. I don’t appreciate your tone either.
You are right! I apologise for my tone!
at the end of the day why would you have money in a goal or pot and want to use an overdraft - be it called an overdraft or not depending if you have money or not in said pot / goal ?
I see your point. And I’m not necessarily arguing against that point. I am arguing against saying “your account balance is card + pots, but we charge you overdraft on card only”.
As a counter point (and I’m not saying that I dogmatically insist on it): I thought it’s the point of pots/goals: flexibility. that I don’t need to maintain separate accounts and balances. That I can just ringfence money in my own account. Otherwise a pot brings only downsides to a separate savings account (which I can get interest on, after all)
and I agree with you about the clarity / or lack of it in T and Cs - I would say that managing your money - for me is better in Monzo as …lol …ever spinning circles…
Yes @nanos you are correct.
It is very simple.
Overdraft is payable on the account balance.
The only reason for any confusion is because while Monzo want to charge people for being overdrawn when their account is actually not overdrawn, some users have tried to shift focus away from this on to a competitor who actually does calculate charges based on the whole account and does not do slight of hand with budgeted amounts held in goals or pots 🤷🏼
Actually, am I? Shouldn’t in the last line the * also be in the last column? For a moment I thought they only pay interest on pots, but they just pay and charge interest on the net balance, is that correct?
in your view …
I would say Monzo act responsibly and ask you to move money out of your pot to cover what you owe , Starling encourage you to spend what you haven’t got…oh what the hell … trolling
lol who knows >… its simple though …
I’m sorry, but that’s just were I vehemently disagree with you. This is not a matter of view: In my Monzo app, and on my bank statement, which is a legal document, my balance is my card balance plus my pots balance. It is a fact that your account balance is card plus pots in the current setup. (Even though it is apparently unpopular to label facts these days, and even saying this is considered silly…)
this thread reminds me or arguing with anti-vaxxers 
.
no I agree with the uncertainty in the T and Cs - lol about the only thing we do agree on - I said as much 2 or three days ago talking about the same thing
One logical reason why someone would want to use goals/pots and an overdraft at the same time is for prudent budgeting and to not overspend when they have anticipated expenditure due.
Say they have a £500 overdraft and no goal, they may use too much of their overdraft and the £200 bill they were due to pay that month can’t be paid because they did not ring fence it to stop it being spent.
If they set a £200 goal for the anticipated Bill, then they can only use £300 of their £500 overdraft, and hence they still have the money left to pay their Bill.
It makes for better finance management for those where money is tight or where they are in financial difficulty.
Starling pay account interest on the overall account balance inclusive of pots/goals, they charge overdraft interest on the overall account balance inclusive of pots/goals.
Monzo charge overdraft interest not on the overall account balance but on only part of your account balance, i.e. account balance less any balance in pots.
Richard, with the greatest of respect - this is where we came in - remember the broken fridge, the overdraft that wasn’t really an overdraft because you had money in a goal so you spent it , and then the unexpected S*it happening in life ? - Im not going to go through it all again …we disagree
we agree on the misleading T and Cs