Do you think that worrying about paying 1 debt at a time is the best way

silkglade

Hi everyone, I have recently returned after a while away.

I am planning on using ALL spare cash (left after all bills have gone out) on paying as much as possible off 1 card at a time.

Do you think this is best, I thought that starting with the smallest first gets them amount down quicker too.

What are your views?

elaine12022

that's the advice I've had in the past, pay minimum off all,and throw everything first onto the one that would get paid off first (by dividing total amount by the minimum payment - you go with the one with the smallest answer & so on )(snowballing the amounts as you go). Psychologically then, you can have the satisfaction/relief of having paid it off.

greenbrucelee

I would pay whatever has the highest interest of first. But then again my advice may be totally wrong as I am in big debt at the moment.

sheba

From a financial point of view (rather than personal satisfaction aspect) you should pay the minimum payments on ALL (so as to avoid penalties) and throw any excess to the card that is charging you the most interest percentage-wise (regardless of how much you owe on it) as then you will actually pay less to them in the long run and allow yourself to clear that debt quicker. Then rinse and repeat until your last debt is the debt will the smallest APR. Of course if they're all interest free, go with personal satisfaction of clearing the smallest debt first, great morale boost!! Good Luck!!

Firewalker

Focusing on paying one dept at the time is the way to go. It is not necessary to start with highest interest - I would start with the smallest so there are some quick gains. The important thing is when one debt is paid to put the money into the next one.

Firewalker

CH27

sheba wrote: »

From a financial point of view (rather than personal satisfaction aspect) you should pay the minimum payments on ALL (so as to avoid penalties) and throw any excess to the card that is charging you the most interest percentage-wise (regardless of how much you owe on it) as then you will actually pay less to them in the long run and allow yourself to clear that debt quicker. Then rinse and repeat until your last debt is the debt will the smallest APR. Of course if they're all interest free, go with personal satisfaction of clearing the smallest debt first, great morale boost!! Good Luck!!

I think this is the best way.

silkglade

Well very luckily my highest debt (card) has a special LOB interest rate on it and is really low interest.

I was thinking of my Sainsburys card next (after barclaycard) as the interest to minimum payment means that only 20pence is paid off the balance each month..... That is MAD.

silkglade

Hi everyone, I have now got my signature sorted and the debts are in order of lowest to highest and the order in which we intend to pay them off. Really scary stuff :eek:

I will use the minimum payments no longer needed from the finished cards to add to the payments to the next one that way should reduce the time that each one takes.

We've had some good luck yesterday saying that the final amount was in for the service charge part we pay is in and we are owed £372.86 and is now as a credit on our rent account and to contact them if we want a BACS or cheque payment back.... Of course I do!!!! Letter already sent. :T

So that means once that money is back in our bank account the Barclaycard will be paid in full (which would have been next month instead) :j

SO depending on how much I get in overtime next pay day we are aiming to make the last payment back to my Dad AND pay £600 (hopefully) off the Sainsburys card. (we will have just over £600 a month towards extra payments once my dad is paid off)

Then November and December we should be able to do the same and get that one finished with before the end of this year. YAY (as would have been Jan)

My Credit card companies have been refusing to re issue my cards so that one runs out at the end of Jan 2012 anyway so I very much doubt they will either. So there will be NO temptation to re use it either.

Hoping that this is the right way to go about it all and that we all stick to the plan and get this sorted asap.

We have also decided that every time we totally pay off a debt that we will have a nice family take away as a little celebration of keeping going. (not for the Barclaycard though as it is being paid too close to the beginning of our journey).