Should I continue to card tart or pay it off ?

mellli

Hi

I have been a card tart for a number of years. Shirfting my debt to 0% BT for as long as possible. However now that I have become a MSE I have managed to save an emergeny and a little nest egg, which is enough to pay off my CC debit, but I don't want to... becuase I enjoy watching my savings grow.

Ive looked at the fees v interest that I would get in an ISA and there is very little difference

What would you do?

CH27

Personally I would pay it off.
You will soon rebuild your savings & being debt free will be such a psychological boost.

Sarah_Newton

I also think that paying the debt is a nice clean thing to do. Why to bear more interest when you can get rid of it, by making payments on time.

izools

It depends, if your credit rating is good enough to continue tarting and pay only a 2.98% fee once every 15-17 months, and you are able to shift your savings nest from one term saver to another that pays over 3% APR, then you will still be financially better off as the interest earned will outweigh the fees paid for balance transferring.

And should a time come where you find yourself unable to get another balance transfer, pay off the card with your savings before it's current free period ends, and pocket the interest

mellli

thank you for your speedy response, your opinion is very much appreciated.

thenudeone

Depends how likely it is that might regret not having this year's ISA allowance. Once the tax year passes you've lost it. If you don't pay income tax it doesn't matter.

If you are expecting money (from an inheritance, house sale, bonus, whatever) in the future, I would keep tarting and leave the savings in the best Cash ISAs you can find.
Then when you come into money, use that to pay off the credit cards once the 0% periods end; leaving you with a large pot of tax free savings.

If you cash in the ISAs now; then when you come into money you can only put £5100 into a Cash ISA each year, the interest on the rest will be taxed.

Just my take. Others will have different views.

scott_lithgows

I could pay off my credit card tomorrow however it would mean that it would clear out my savings.Which could cause me problems this year if the work went on strike/the wife or kids have a birthday/Xmas happens this year!

I,m keeping going,I also think it gets you better retention deals if you know that if any credit card provider annoys you,its binned soon as.

Paul_Herring

I'm in the "pay the cards off" camp.

Psychologically it'd be better, since you would no longer have that debt, and no more worries about being able to find the next 0% for 5 1/2 months.

Don't close (all) the cards though - that's what you use as your cushion/emergency funds while you build your savings up again, but don't actually plan on using them for the moment.