Graduate with debt

moomin82

Hi everyone, i am new here!

I graduated last summer and still have a lot of the debt I built up during my time at university. :rolleyes:

I live at home so my expenses are low. But I would love to clear my existing debt.

I have 3 different credit cards at their £500 limit and a £1500 HSBC overdraft.

So my total debt is about £3000.

I did have a student loan which amounts to about £9000 but that doesnt need to be paid off as urgently as my credit cards and overdraft.

I started a new job 2 months ago and am earning £19,000 a year. But after tax and deductions it means I take home around £1,100 Less than I thought.

I was wondering anyone could offer any advice. I especially want to pay all my credit cards off as soon as possible, because the interest means I hardly make a dent in them every month.

I have heard mixed views about getting a loan to pay off credit cards and overdraft, all views are welcome! Please advise!

I feel like I am going to be a poor graduate forever.

DrFluffy

Have you thought about transfering your credit card debt to a new card with a low % Balance transfer - this will get around hte interest issue and you can start trying to make headway. M&S &More card is supposed to be the best around at the mo, as it has 3.9% on the life of your balance transfer (i.e. very little interest to pay on your card, providing you do not start using it - I'm guessing your current cards will be around 15-16% interest pa).

PS - I'm guessing the £1,100 is per month, else your tax rate is wrong

BT_man

£1100 a month is quite a bit for someone "living at home with low expenses"...
I agree with DrFluff about transferring to an low/interest free card (cut it up as soon as you get it). I't shouldn't take long if you don't spend too much..

lynsayjane

i'd give my eye teeth to get that side of 1k a month. i have a little more debt than you, much less income and a mortgage and all that goes with it. my dfd is in about a years time so im going to guess that you could do it in a couple of months with a few cut backs.

fancy posting your soa up so we can see where your money does go to try and fix it?

CLAPTON

you need to post a statement of affairs (SoA) detailing your income , your spending and your debts (amount, minimum repayment and APR) also general details of your situation

also if you post details of your payslip it might be possible to check your take home pay is correct.

see below for more details
http://forums.moneysavingexpert.com/showthread.html?t=107280

DrFluffy

Flicking through today's Idependent - in the main newspaper there is an ad for Capital One = 0% balance transfer until Jan 2008 (2% transfer fee). Given your take home, you *should* be able to clear your cards by then, I would have thought...

dudleyboy

Hi there. You've done pretty well to graduate with only £3,000 of debt! Good going - you're not exactly what i'd call "poor". You earn a good wage and have few monthly outgoings. Apply for a 0% interest free credit card (you don't need a loan for £3,000) and pay it off in monthly installments. If it's not paid off by the time the 0% runs out, apply for another 0% card and transfer the remaining balance to that.

Repay £250 pcm and you'll be rid of this debt in a year. Repay £500 pcm (if you can stretch to it for 6 months) and it'll be gone in half that time!

Good luck!

loubie_lou

£1100 is quite low per month for someone earning £19k! When I was on £16k i was picking up £1033 per month so you may want to get it checked out!

DrFluffy

"After tax and deductions" - I took that to mean her tax and outgoings - i.e. taking off any rent she pays her parents etc and that £1,100 was her 'disposable' income...

dudleyboy

Hmm... it could be read either way i guess. moomin82, check to see whether you are still on an emergency tax code. you could be paying more tax than you need.

DrFluffy

I'm kind of hoping she is paying emergency tax now... A nice cheque back from the Inland Revinue and debt problem solved in one fell swoop!