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Debt repayment vs savings

Callisto
Posts: 928 Forumite
I've been on this forum for quite a while, but this is the first time I've bared my soul and posted my SOA, so please be gentle with me! 
I would like some advice on paying back my credit card vs saving... Basically I'm just in the process of moving my one credit card from Virgin to Natwest on 9 months 0%, but I have loads of things I need to save for as well, so was just wondering how other people would divide the money? My credit rating is fine and I am happy to switch to another 0% when this deal expires, so I suppose there is no huge rush to pay back the credit card debt, but I would like to see it gone!
Things I need to save for are driving lessons and my own old car for practising driving with my family and to be my runaround when I pass my test while I save for a better one. Also need to save for our wedding (hopefully in 2008) and a holiday to Scotland next year to look at wedding venues and try and get one booked. The other big thing I'm saving for is for me and my boyfriend to move into our own rented house, ideally by next summer at the latest as we are currently living with boyfriend's Mum as I was out of work for six months... and there is no way we are getting married until we have our own place! Boyfriend is not working due to illness, which is why I'm only doing my SOA as his money only really covers his petrol and car running costs, cigarettes and toiletries. (I can't learn to drive in his car because it is a modified performance car.)
I realise I'm in a good position at the moment as I don't have the expense of running a household and would like to put aside money and get my debt down before we move into our own place.
Callisto's SOA
Incoming
Work salary per month - £1020
Outgoings per month
Rent to boyfriend's Mum - £100 (She buys majority of food)
Food I buy for myself (such as cereal and snacks for work) - £10
Bus pass - £36
Credit card - changing to Natwest 0% for 9 months owe £2870 - will pay £50 minimum each month
Toiletries - £10
Going out/day trips - £80
Petrol for going out - £40
Clothes - £30
Mobile phone top up - £10
Takeaways/Eating Out - £30
'Pocket' money (magazines, small treats etc) - £10
DVD/CD purchases - £20
Birthday gifts - £20
Subtotal - £446
Money I'm currently saving per month/already have saved
Wedding - £100 (currently have £600 saved, so I need to save more every month as we would like a minimum of £3000 for a summer 2008 wedding. This doesn't include honeymoon, but I'm happy to stay in Scotland for a couple of weeks after the wedding and then go abroad later the same year.
Scotland holiday - £40 pm. Already saved £20. (hoping to go May next year for one week, so will maybe need to save more as we will probably be staying in B&B's as we need to move about quite a bit to look at wedding venues.)
Driving lessons - £200 pm. Already have £400 saved. I really want to pass my test, have previously had lessons, so I'm hoping it won't take me more than six months to get to test standard. Would want at least two lessons a week, plus practice with family.
Car - £60 pm, already have £115 towards this and parents have offered to give me another £100 or so towards a car. Also includes money towards tax and insurance (but will have to pay first year insurance monthly as will be around £500 for the year)
House rent deposit - £100 pm. Already have £10. Hoping to move out by August 2007 at the latest or earlier if I pass my driving test before then. Will probably need a minimum of £1000 for deposit/first month's rent.
Christmas gifts - £60 pm. Already have £10. Will have £250 for Xmas for 13 people, so averages just under £20 each... What do you spend on gifts?
Subtotal - £560
Total - £1006
Any opinions on whether I'm saving the correct amount in the correct order are very welcome as if I ever have extra money left at the end of the month, I can't decide how to split it! Thanks for reading my epic post!

I would like some advice on paying back my credit card vs saving... Basically I'm just in the process of moving my one credit card from Virgin to Natwest on 9 months 0%, but I have loads of things I need to save for as well, so was just wondering how other people would divide the money? My credit rating is fine and I am happy to switch to another 0% when this deal expires, so I suppose there is no huge rush to pay back the credit card debt, but I would like to see it gone!
Things I need to save for are driving lessons and my own old car for practising driving with my family and to be my runaround when I pass my test while I save for a better one. Also need to save for our wedding (hopefully in 2008) and a holiday to Scotland next year to look at wedding venues and try and get one booked. The other big thing I'm saving for is for me and my boyfriend to move into our own rented house, ideally by next summer at the latest as we are currently living with boyfriend's Mum as I was out of work for six months... and there is no way we are getting married until we have our own place! Boyfriend is not working due to illness, which is why I'm only doing my SOA as his money only really covers his petrol and car running costs, cigarettes and toiletries. (I can't learn to drive in his car because it is a modified performance car.)
I realise I'm in a good position at the moment as I don't have the expense of running a household and would like to put aside money and get my debt down before we move into our own place.
Callisto's SOA
Incoming
Work salary per month - £1020
Outgoings per month
Rent to boyfriend's Mum - £100 (She buys majority of food)
Food I buy for myself (such as cereal and snacks for work) - £10
Bus pass - £36
Credit card - changing to Natwest 0% for 9 months owe £2870 - will pay £50 minimum each month
Toiletries - £10
Going out/day trips - £80
Petrol for going out - £40
Clothes - £30
Mobile phone top up - £10
Takeaways/Eating Out - £30
'Pocket' money (magazines, small treats etc) - £10
DVD/CD purchases - £20
Birthday gifts - £20
Subtotal - £446
Money I'm currently saving per month/already have saved
Wedding - £100 (currently have £600 saved, so I need to save more every month as we would like a minimum of £3000 for a summer 2008 wedding. This doesn't include honeymoon, but I'm happy to stay in Scotland for a couple of weeks after the wedding and then go abroad later the same year.
Scotland holiday - £40 pm. Already saved £20. (hoping to go May next year for one week, so will maybe need to save more as we will probably be staying in B&B's as we need to move about quite a bit to look at wedding venues.)
Driving lessons - £200 pm. Already have £400 saved. I really want to pass my test, have previously had lessons, so I'm hoping it won't take me more than six months to get to test standard. Would want at least two lessons a week, plus practice with family.
Car - £60 pm, already have £115 towards this and parents have offered to give me another £100 or so towards a car. Also includes money towards tax and insurance (but will have to pay first year insurance monthly as will be around £500 for the year)
House rent deposit - £100 pm. Already have £10. Hoping to move out by August 2007 at the latest or earlier if I pass my driving test before then. Will probably need a minimum of £1000 for deposit/first month's rent.
Christmas gifts - £60 pm. Already have £10. Will have £250 for Xmas for 13 people, so averages just under £20 each... What do you spend on gifts?
Subtotal - £560
Total - £1006
Any opinions on whether I'm saving the correct amount in the correct order are very welcome as if I ever have extra money left at the end of the month, I can't decide how to split it! Thanks for reading my epic post!

0
Comments
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I wonder what people's opinions are as to whether 0% balance transfer fees will be massively available in 9 months...?
I am just thinking about the interest rise and potential additional rise next month....will they clamp down? I guess that's a whole new debate though!Bank Balance: In the black for the moment.
Sainsburys Loan: Cleared July 2010
Credit cards: AMEX Airmiles Card: direct debit set to clear balance monthly
0 -
hope you are using your ISA allowance and have researched the best saving rates.0
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Hi Callisto,
Well you certainly have the right idea planning for the future. I am in a similar situation, I could pay off my debt a whole lot quicker if I didn't do things like, go on hen weekends and cut right down in all other areas. It's a question of priorities. I have a couple of points:
1. Will £50 cover the minimum payments? I have £1840 on my credit card and the last minimum payment was £47 I think. It's not a lot but worth considering.
2. The driving lessons, I know it's important to you and I'm not sure how much they cost nowadays but how about you just aim to get your flat and pass your test next August, that way you will have saved up more in your car fund. If you reduce this to £100pm will it make that much difference?
3. Your xmas fund, from January you could halve this and still have more money put aside for Xmas 07.
4. The house deposit savings, to get £1000 you need to save about £84pm, put this extra £16 towards your credit card debt.
If you did this you would have paid off £664 from Sept to December and then a further £980 from January to May, leaving you with £1,126 to pay. You will have to think carefully about whether you will be able to BT this to another account, I am making sure that this is the last time I have to do this as I am sure the days of fee free 0% BTs is coming to an end.
Last point (promise!) would your OH sell his car and get something that you both could drive? Would save you a lot and you may even have a little left over to put towards the wedding.
Good luck!Saving for an early retirement!0 -
Hiya,
I'm still a newbie finding my way but I wanted to point this thread out for you if you are looking for driving lessons.
My OH has brought 12 of them so has 24 lessons for £207 as he cashed in the simulator vouchers for £15.50 off each lesson.
Hope that helps you divert the money you were saving for driving lessons elsewhere
Kitty0 -
Imelda wrote:Hi Callisto,
Well you certainly have the right idea planning for the future. I am in a similar situation, I could pay off my debt a whole lot quicker if I didn't do things like, go on hen weekends and cut right down in all other areas. It's a question of priorities. I have a couple of points:
1. Will £50 cover the minimum payments? I have £1840 on my credit card and the last minimum payment was £47 I think. It's not a lot but worth considering.
2. The driving lessons, I know it's important to you and I'm not sure how much they cost nowadays but how about you just aim to get your flat and pass your test next August, that way you will have saved up more in your car fund. If you reduce this to £100pm will it make that much difference?
3. Your xmas fund, from January you could halve this and still have more money put aside for Xmas 07.
4. The house deposit savings, to get £1000 you need to save about £84pm, put this extra £16 towards your credit card debt.
If you did this you would have paid off £664 from Sept to December and then a further £980 from January to May, leaving you with £1,126 to pay. You will have to think carefully about whether you will be able to BT this to another account, I am making sure that this is the last time I have to do this as I am sure the days of fee free 0% BTs is coming to an end.
Last point (promise!) would your OH sell his car and get something that you both could drive? Would save you a lot and you may even have a little left over to put towards the wedding.
Good luck!
Thank you for your input Imelda, and apologies for the delay in replying, I have been mulling over what to do in the past week or so and my decisions are...
I am going to put off buying a car for myself, my parents will still give me the £100 and my boyfriend reckons I will get around £60 scrap value for my conked out car (I'm never owning a Rover again!), and reassess in two months or so when I'm well into driving lessons and it's getting closer to winter because my boyfriend will not be able to drive his car in icy conditions due to it being high powered and rear wheel drive, so we will only have to pay for my car from about October - March while his car stays in the garage and both cars April - September, so I guess it's not as bad as it could be!
I'm not going to put off driving lessons in favour of getting a flat first as I will be in a worse financial situation once I have to pay out household bills, so I would like to get my test passed by next summer and then move out, as it's going to cost around £60-£80 a week for 3-4 hours tuition (with slight reduction for block booking!) Also if I put off driving lessons I will have to retake my theory test again next September. Also, I'm getting to the point where I'm sick of having to rely on others for lifts and waiting in the pouring rain for buses!
With the house deposit money, any extra left over will be put towards furniture as we only own a bed, TV, computer desk and computer! We have various family members saving housey stuff for us ie crockery and cutlery, but we will need to buy some secondhand stuff to start us off - sofa, shelving, storage etc
I will definitely be saving throughout the year next year for birthdays and xmas!
I don't know what I will do when the 0% finishes in May, but I am determined not to spend a single penny on the card, so am hoping it will be a more manageable amount by then. In fact I will cut the card up as soon as it arrives!
That's my plan for now anyway... does anyone else have any thoughts on my situation, it would be much appreciated!0
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