0% v pay it off soon as poss. Which would you do?

fairylights_2

OH has applied for an HSBC card to BT our last £900ish onto. Chances are with his track record they'll say no, but if they agree to one, we aren't currently sure what to do. We've been paying off £250 every month, some months a bit more if there's a bit to spare, and with a bonus he's due in March the card should be clear. BUT if he gets it, what do we do? bank the £250 and just make the min payments? or get it gone? It would move our debt free date much further away, but it's so small now (in comparison to days past) that I'm not worried any more.

Partly I'm looking for advice, partly I'd like to see what everyone else would do in this situation.

Edit - I've gone for postpone the debt free day, although I reserve the right to change my mind :rotfl:

climbgirl

I guess the most money-saving option would be to pay the minimum and bank the money in a high-interest saving account for the 0% period.

But if that's only 6 or 9 months, you're only going to make a few pounds and I'd be more inclined to pay off the debt and start saving with a clean slate. You're so close now and you've worked so hard to get yourself out of debt. It'll be such a fantastic feeling when you pay that last bit off, I think that's worth more than a few pounds of interest.

brummiebabe

We had this situation - could have delayed DFD. Howver, for us, the thought of having no debt was FAR more important than earning a little interest! Probably not very MSE, but I hate debt & couldn't wait to clear it!!

Each to their own though!!!

$17mma

brummiebabe wrote:

We had this situation - could have delayed DFD. Howver, for us, the thought of having no debt was FAR more important than earning a little interest! Probably not very MSE, but I hate debt & couldn't wait to clear it!!

Each to their own though!!!

I agree with Brummie and that why start to save when you have debt.. even if it is a minimal amount debt is still debt...I would clear the debt and start saving as a debt free person :j why hang onto debt get rid of it!

But if you feel you earn more money and will be better off not just financially but also peace of mind from having the debt and saving at a higher rate then go for it... ( not sure if that last part made any sense)

mountainofdebt

Sitting on the fence here but if you get the 0% card why not put the money in the bank, make minimum payments to the 0% and before the 0% period ends, withdraw the money and pay off the debt.

That way the debt is still covered (so your assets are greater than your liabilities) and you will be earning some interest rather than paying interest

fairylights_2

Well, good news, I think. OH got accepted for the card! Which means we might be ok as far as the credit world goes. We've been debating a cashback card of some description for once the debt's paid off, so at least now we don't feel like all this work has been for nothing.

So. Not yet knowing what his limit will be - or indeed if they'll give him enough to cover the full balance of his card - do we pay it off? I'm thinking we could pay £100 a month for the next nine months and the spare cash in the next seven weeks could just sit in our savings account.

Help! Why couldn't we get a 0% card in the last year when the debt was massive and the interest horrendous?!?!? What should we do? What would you do?

skintchick

I have the same situation, and I have gone for postponing my DFD and banking the money, so it can pay for my car service etc.

And you only have seven weeks to go anyway - I have a year.

fairylights_2

The card finally came today - with a limit of £2225! We can bt the balance across, which will save us one statement's worth of interest (probably only about £20, if that!). I have to admit at this point we reckon we'll pay that card off now, but may well try a little stoozing with the rest of it - it'll probably end up being the online payment card (grocery shop online, possibly books too) Can't believe there wasn't a clear winner from the choice, though. I'd love to know who said which!

philb120

fairylights wrote:

OH has applied for an HSBC card to BT our last £900ish onto. Chances are with his track record they'll say no, but if they agree to one, we aren't currently sure what to do. We've been paying off £250 every month, some months a bit more if there's a bit to spare, and with a bonus he's due in March the card should be clear. BUT if he gets it, what do we do? bank the £250 and just make the min payments? or get it gone? It would move our debt free date much further away, but it's so small now (in comparison to days past) that I'm not worried any more.

Partly I'm looking for advice, partly I'd like to see what everyone else would do in this situation.

Edit - I've gone for postpone the debt free day, although I reserve the right to change my mind :rotfl:

I was in a sort of similar position- A & L gave me a£10000 credit limit at 0% for 10 months. I actually only need to balance transfer aprox £3000 so I took the whole amount and put the money I didn't need into my online saver account. I'll put it back near the end of the 0% period along with any interests as well as doing the minimum payments etc. That way it should help my debt free day along.

Bokken_2

Pay it off ASAP
Then come back here and brag your debt free..
Then spend the rest of the year stoozing
Stick with it now your near then end..
good luck your on the home straight