Best strategy for specific dept consolidation

astrogkg

Hello everyone,

I am new to this forum, though not new to debt at all :-(
Currently, my debt situation is as follows:

1. I own £12000 on a unsecured loan to be repaid in next two years.
2. I have a balance of around £5300 with a frozen APR of 21.9% on an credit card.
3. I have a balance of around £5700 on another credit card.
4. I have an overdraft of £4500 with my bank which is completely used at the end of every month.

I am paying back the minimum amount currently for both credit cards
as well as the loan re-payment every month.

My monthly salary after tax is around £2700.

What is the best strategy in my situation to get out of this debt as fast as possible? Additionally, I don't own a house, but renting.

Thank you in advance for your help.

G

Tixy

Hi and welcome.

Ideally the best way to tackle debts is to increase your income and reduce your outgoings as much as possible to free up as much as you can to repay towards the debts.
Then you can look at 'snowballing' to make sure you pay the least amount of interest possible. Snowballing is where you pay just the minimum to all your debts except for the one with the highest APR and you pay all you can to that debt. Once that debt is clear you snowball its monthly payment to your next highest APR debt and so on until all are clear.

Have you worked out a detailed monthly budget yet and looked to see where you can save money/cut back? If not this is a good starting point to see how much you can afford to repay each month - this is a good calculator - http://www.makesenseofcards.com/soacalc.html