Advice on tackling debts!

Moneytroubles_2

Hi all,

I only joined up a few days ago and I am already feeling really positive altho I am very impatient, I know it will take me a long time to get debt free but im motivated by success, once i have paid off my first debt i know this will spur me on even more!

My question is what do you feel is the best approach to tackling debts, do you just pay minimum payments, or pay extra off on all debts, or do you focus on one debt in particular and pay more than minimum payments until that one is paid off.

Would love to hear your stories / ideas!

Moneytroubles X

Tixy

Mostly people are advised to pay off the minimums on all debts except the one with the highest APR and pay as much as you can afford off that one. When that debt is repaid you move on to getting rid of the next highest APR debt.

Another approach which works for some is to pay off a small balance first to feel like you are 'getting somewhere'. This can work weel with a small credit card balance as once repaid you can ask if they have any good balance transfer offers (e.g. 0% for 12month or around 6% for a life of balance transfer) then you can move a high rate credit card onto the newly cleared card. The card providers usually only do this once a card is cleared so as to keep your business.

Moneytroubles_2

Thanks, I have an overdraft of £450 with an old account I know longer use, I have just set up a payment plan of £40 a month until i reach 0 and the account can be closed, I think I may try and get this paid off first just to give me something to scream yayyyy! about, and then look at my highest APR's!

starnac

hi moneytroubles. well done on deciding to tackle to debts.

the best way to tackle your debts is a personal thing. ideally you should pay off the debt with the highest APR first then the next highest then the next etc to save on interest payments. however a lot of people then feel they are not getting anywhere as usually this is the biggest debt so as Tixy said they start with the smallest debt and get it paid off getting a sense of achievement. paying off your o/d is a good place to start. once you see that paid off it should spur you on to get the rest paid off.

only you can decide which is the best way for you. although the people on this site have plenty of advice so don't be afraid to ask.

good luck with your journey