Help on my Monthly Finances (what should i do?)

Mini_Bear

8.5k finance for a not new car. thats ridiculous!!
What about saving up for what you want and never paying a penny interest?!
I applaud the OPs efforts in trying to clear his credit cards as quick as poss. I suggest you write down your income and outgoings and really budget hard to get the debts cleared in the next 6-9 months. it will be tough but you will learn a vital lesson "Debt Sucks".

bendix

jadex wrote: »

It doesn't make that much difference whether you are paying just minimum or more unless you are actually paying in full.
It is better to pay minimum on all cards and concentrate on clearing them in full one-by-one. But not by weekly payments as you will not be rewarded for doing this, in fact you are making a favour to your card provider - keep the money in 'high' interest savings account and clear the card in one go.
Pay minimum on both cards and save £400 to clear the smaller debt as soon as you get your statement (the best the very same day), no matter if it has higher or lower APR as the amounts you owe are uncomparable.

With respect, that is the single worst piece of advice I have ever read on this forum, and there have been some pearlers.

Paying the minimum owing on a credit card is universally known as a very bad strategy, and for you to suggest that it's better to keep money in a high interest savings account than pay it off is palpable nonsense. Have you not read seen what is happening with interest rates?

NEVER EVER EVER pay minimum balance on credit cards.

Let's face facts here. This guy is probably taking home around £1500 a month, perhaps more. He is likely paying either nothing or some nominal amount in rent. His first priority is to get rid of the credit card debt. The first card with the £400 balance could be paid off in a month. The second card in 2-3 months. Then he can focus on the loan, paynig at least double the minimum to clear it quickly. He could be debt free in a year.

Instead, he chooses to take other loans out - where does it stop?

michaelboyd2

I have to agree with Bendix and clapton.

Pay off the debts in the order recommended by Clapton and concentrate on reducing how much you spend.

An easy way to start on this is to take packed lunches to work. That alone will save you almost £3 a day. That's almost £60 or more per month. I have been doing this for 4 yrs and have cleared of almost all my debts.

All the best.

zarazara

Hello again Original poster. I seems to me that you have come on here for advise and been given a hard time. Actually the people who have replied are correct, but if the rather forceful advice makes you feel miserable it will not help you.
You NEED to feel positive about this situation. As I said before, pay off the £400 first to give yourself the psycological boost that you CAN do it. Pay off as much as possible as quickly as possible on the others too.
Do not take on more debt, simply do without things.
This will not last forever, but debt will if you let it.
Give yourself small goals to reach then give yourself a huge big pat on the back when you reach them, even something simple like a gold star on the calender boosts morale.
Take care and come back regulally tolet us all know how you are doing.

daily_2

Highest apr first, not smallest debt.

agsnu

daily wrote: »

Highest apr first, not smallest debt.

That's the best plan in a perfect world where people are entirely rational. However, it can be psychologically rewarding to entirely clear debts and close accounts in a different order. Reduces temptation to use the line of credit, less bills hitting the mat ever month, etc etc.

CLAPTON

agsnu wrote: »

That's the best plan in a perfect world where people are entirely rational. However, it can be psychologically rewarding to entirely clear debts and close accounts in a different order. Reduces temptation to use the line of credit, less bills hitting the mat ever month, etc etc.

maybe

but it's best to give the facts first; people can then choose to adapt them to suit themselves....

in any event we don't know the APRs

daily_2

Debt, like all problems, should be dealt with rationally.

The clear the smallest debt off idea perpetuates because people keep repeating it, and more and more people pick it up as the way to go. Ditto saving pots funded with debt, cutting cards up, putting them in the freezer, all completely irrational if you have made the decision to stop overspending and get out of debt as fast as possible.

Ste_C

If you're still living at home and have had this job for 5 years, what on earth have you spent the best part of £100,000 on?! What have you got to show for it?

Yes, I AM being nosey, but I can't understand how you could get into this position.

zarazara

Thats a great post Ste C. Goodness what an eye opener. Wish I'd thoughtof it.
I wonder just where the money went? A lesson for us all.