I’m a single mum on £28k but live in my overdraft. How can I pay off my debt while still saving towards a better future for me and my son?

Welcome to Money Matters: GLAMOUR’s weekly dive into the world of finance. We’re chatting all things personal finance, from contracting rights in the workplace to expert mortgage advice and saving for your first home, to ISAs and dealing with debt, to help empower you to make better choices. Now more than ever it’s important to understand our money, but so many of us feel as if we don’t have a handle on it – or worse, feel anxious and scared about money. 

So each week, a woman in a unique situation will give us an honest breakdown of her finances, and our expert will tell her easy tips on exactly how to tackle it. So, take a seat, and let’s talk about money…

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Grace* is 28-year-old bank employee in Bradford. She lives in her overdraft but would struggle to take on a second income as a full-time single mum. Here, she shares her money diary.

I’m a 28-year-old old full time worker from Bradford. I am also single parent to a 5-year-old old who has recently started school.

I work as a branch manager for a bank and I earn £28,600 a year before tax. I rent a three-bed house which financially makes sense as it’s on a rent-to-buy scheme, so it’s significantly cheaper than other houses I viewed.

I do manage to save £300 a month now, although I have dipped into this a lot recently and I live in my £1000 overdraft all month. Due to outgoings, my need to save to have something to fall back on, and paying for everything on my own, I don’t have a lot left at the end of each month.

I’m struggling as to whether I should take up a second job – learn to be something like being a nail tech, for example – for a bit of extra cash. But being a full-time single mum, I’m not sure I can sacrifice the time.

Should I pay off the overdraft and any other debts with the savings I have, to end them early without penalty, and then be able to save more on a monthly basis? Or do I just need to find a job that pays more?


Current account: £-900
Savings account: £850


Annual salary pre-tax: £28,600
Annual salary post-tax: £23,085
Monthly wage pre-tax: £2,382
Monthly wage post-tax: £1,956
Any other incoming payments: £150


Rent/mortgage: £550
Bills: £530
Other: £150
Splurges: £80


Overdraft: £1000
Buy now, pay later retailer: £150
Car loan: £2,660


My worst money habit: Takeaways and alcohol – cheaper than going out and I don’t always have the time to cook.
My biggest money worry: Do I use savings to pay off debt but have no safety net? My family aren’t in a position to have lump sums ready to lend.
My financial hopes for the future: To save enough for a deposit for a house so I’m putting money into myself and securing a better future for me and my son, instead of the £19k I’ve spent in rent over the last 3 years.

Personal finance lies
The truth is, the personal finance industry peddles some shady ideas. The thinking that saving is mainly about not spending and frugality is an unhelpful load of BS. It can’t be the case that the 42% of all 25-34-year-olds with less than £1000 in savings just don’t have the determination and willpower to not spend their money on takeaways and expensive activewear. There might be a bit of that (we’re all human) but by far the biggest predictor of savings is income. The problem is that addressing the fundamental problems of low pay, high living costs and helping people to access higher quality work is much more difficult than serving up budgeting advice.