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  • FIRST POST
    • stubbyd
    • By stubbyd 16th May 17, 9:20 PM
    • 55Posts
    • 15Thanks
    stubbyd
    Am I missing anything...?
    • #1
    • 16th May 17, 9:20 PM
    Am I missing anything...? 16th May 17 at 9:20 PM
    Some back story ... I always pay off any credit I have within the time limit so as to avoid any interest charges but somewhere along the way the wife & I have managed to get to a stage where we live from month to month.

    By that I mean most large bills - food, fuel, etc have to go on our CC which we end up paying off the following month and consequently never have any spare money hanging around. A few large car repair bills forced me to some thinking .... part of which involved taking out a loan for as long as a CC would allow and other options.

    Then I sat down to work out that after all bills are paid and some incidentals (daughter's piano lessons, etc) and all income allowed for I arrived at a figure that is essentially spending / spare money each month. I then figured if I could eliminate the monthly CC payment we'd be much better off. So then I thought if we could eliminate that "debt" and budget the necessaries - food, fuel, fun we'd still have a decent amount to put away or even put it towards funding a new car.

    The Point: So, after all this came the crunch question.... "how to pay off the month on month CC bill so as to have free cash"?

    First (and admittedly so far only) thought is to get a CC with a long(ish) interest free payback term and then add the budget of paying that off into the monthly bills. If I could get an 18 to 24 month term that would add a small and extremely manageable cost to our monthly budget.

    I've checked and double checked all SO's and DD's and other regular bills (piano, martial arts classes, etc) and am quite comfortable with the sums. I get paid on the 8th, the wife on the 18th and I know both of us would have to be very disciplined not to use the CC again but it is possible.

    So am I missing anything?

    Should I consider other options to pay off (for arguments sake) this months CC bill leaving me with the cash to start budgeting?

    What are the other options... if any?
Page 2
    • getmore4less
    • By getmore4less 17th May 17, 5:38 PM
    • 29,486 Posts
    • 17,623 Thanks
    getmore4less
    The reality is if you have £1k per month coming in and you spend £975 on stuff the CC bill goes down £25

    Does not mater if it is cash or CC just track what you spend to your income.
    • stubbyd
    • By stubbyd 17th May 17, 11:13 PM
    • 55 Posts
    • 15 Thanks
    stubbyd
    ..... - what is stopping you from transferring it out into easily manageable monthly payments and starting again with the old card ?
    Originally posted by molerat
    Part of the drive here is to eliminate the one CC I have and not rely on it at all. I realise the plan involves adding a 2nd CC but that would be for a time limited period.
    • stubbyd
    • By stubbyd 17th May 17, 11:15 PM
    • 55 Posts
    • 15 Thanks
    stubbyd
    Another, but basically the same, method would be to watch the spending on your card and reduce it by £25 each month. The end result would be the same.
    Originally posted by Shakin Steve
    That is true enough - I tend to favour a big bang approach though.
    • stubbyd
    • By stubbyd 17th May 17, 11:20 PM
    • 55 Posts
    • 15 Thanks
    stubbyd
    Why borrow more money? just use your savings.

    Currently any savings you have are through borrowing.
    Originally posted by getmore4less
    Why? Because partly (mostly maybe?) I'd have nothing for a rainy day or the unexpected. Plus some of the savings are dedicated to specific aspects so are not really savings but just another way to budget for high priced items... once such was a professional grade flute for our daughter (she also plays 4 other other instruments).

    And more importantly I think, is that I don't want to add more debt.

    We can manage as we are... I just don't want to and in my head (as it isn't yet a reality) see the way forward is to remove any debt and carefully manage the remaining funds.
    • getmore4less
    • By getmore4less 18th May 17, 9:34 PM
    • 29,486 Posts
    • 17,623 Thanks
    getmore4less
    Why? Because partly (mostly maybe?) I'd have nothing for a rainy day or the unexpected. Plus some of the savings are dedicated to specific aspects so are not really savings but just another way to budget for high priced items... once such was a professional grade flute for our daughter (she also plays 4 other other instruments).

    And more importantly I think, is that I don't want to add more debt.

    We can manage as we are... I just don't want to and in my head (as it isn't yet a reality) see the way forward is to remove any debt and carefully manage the remaining funds.
    Originally posted by stubbyd
    you need to grasp the basic concept that if you have £100 in savings and £100 on the CC you have just borrowed the £100 you think are savings.

    As long as your net situation improves over time going in and out of short term debt is not an issue just cash flow management.

    by not paying down the debt you have now you are borrowing now to pay for things in the future like that flute.


    if you want to reduce your debt do not look at the accounts look at the income* and make sure your spends* are less than that..... your debt will go down.


    * that's looking a full year in advance minimum not jut month to month
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