I want to be debt free!!

sianiflewog

Please can someone advise me.

At the last count, on the 30th September, I have debts totalling £25,000. The majority of the debt is on Credit Cards.

Having recently come out of an unhappy relationship, during which I built up this huge £25,000 debt, I am determined to get myself sorted. Using the advice on this website, I have shuffled my debt about to be mainly on 6.9% for life with Barclaycard and on 0% for up to six months on others.

Here is my dilema:
I save £175 per month into saving schemes with both Scottish Widows and Scottish Provident. I have recently paid just over 7 years, and they are both due to mature on the 10th year (Aug 2009). I have telephoned both companies, who have informed me that the total 'cash in' value for these is currently approx £14,500. I was informed on the telephone that the Scottish Widows policy is underperforming. Would you recommend that I cash these in, and use them towards paying my debt?

I look forward to hearing you comments.

Many thanks, Sian

piglet6

Hi Sian - welcome to the boards... :hello:

I would personally cash them in and pay the lump sum off the debt, because it would make me feel better to get rid of nearly 60% of the debt in one go. :j However, I am not qualified to comment on whether this is the best route to go down re: money to be made over the next three years vs. interest to be paid on credit cards during this time. Hopefully, somebody who is a little more maths-savvy than me will be along shortly to clarify that for you...!

In the meantime, why don't you post up your SOA, and I'm sure the good folks here will pop up with all sorts of ways in which you can cut your outgoings even further than you think possible, so that you can throw even more cash at the debt and clear it even faster!

Piglet

SunderlandBlackCat

Those savings schemes sound an awful lot like endowment policies to me or something very similar. If they are I would cash them in as they are unlikely to give you higher return than the 6.9% on the you're going to pay out on the card(s).

PoundsLookAfterThemselves

sianiflewog wrote:

Please can someone advise me.

At the last count, on the 30th September, I have debts totalling £25,000. The majority of the debt is on Credit Cards.

Having recently come out of an unhappy relationship, during which I built up this huge £25,000 debt, I am determined to get myself sorted. Using the advice on this website, I have shuffled my debt about to be mainly on 6.9% for life with Barclaycard and on 0% for up to six months on others.

Firstly I'd like to congratulate you, facing up to your debt is the hardest part!

Second, well done for moving most of your debt to LOB. It's so much easier to manage than 0% for so many months. How much did you actually move to Barclaycard at 6.9%?

The_Tax_Mans_Cash_Machine

What will the savings be worth when they reach the 10 year date? At present you seem to be about £200 under the total you've paid in - which is usually due to charges being loaded at the front - so another year or 2 or 3 may make a World of difference & you might end up with enough to pay the debts totally & have a bit left over. I'd look into that if I were you because otherwise you might end up throwing money away.

sianiflewog

I have a balance of £8300 on Barcalycard 6.9% for life.

Verbatim

Why not post over on the investments board. I've heard that Scottish Widows has been underperforming since it got taken over but I daresay it depends which product etc. And as Taxmanetc says these plans are front loaded so that the charges come out in the early years and the gains are added later.