what do i do here..Help me make a decision

hadahardyear

I am completely stuck.

I have saved up £600 since the end of December, and was planning on saving £1000 altogether up until the end of January before i started on my debt busting.

However when i look at it, I am paying about £73 a month in interest so what would you guys suggest.
Should i continue saving, just paying the minimum until Feb and then start busting?
figures as below

Aqua is £324 / £350 (interest is £11.67 pm)
Capital one Classic £169 / £200 (interest is £2.65, i pay minimum £10)
Capital One Progress £174/ £200 (interest is £2.65, I pay minimum £10)
Vanquis £983 /£1000 (interest is (41.25)

Im tempted to at least pay off the Aqua one and then use it for spending over the month, so its not like im losing the money but just kind of recycling it so I pay it off in full every month.

I know the general rule is highest interest first but that's not what im bothered about here
Any ideas

LillythePink

In theory pay it off the card with the highest interest rate that way you will pay less interest, but it depends on whether you would rather have the satisfaction of paying off at least two of the other cards instead and having nil balances.

Why would you use the Aqua card for spending in the month and then pay it off - does it give benefits ie airmiles/points/cashback etc? If so, then I can see a point, but if it doesn't then why not just close it (not just keep it hanging around with a tempting nil balance)

You have 4 cards - ok, they are not the highest of balances outstanding but do you really need 4?

I think that if it was me, I would pay off the cards (2 of them at least) and then close them and throw the balance of the money on the Vanquis

lvm

If I were you, I'd pay that £600 to the highest interest bearing CC - Vanquis I think. After all, I'm guessing your savings are for emergencies and in a genuine emergency you could just use your CC - at least you'll be saving interest until an emergency happens (and really, an emergency is rather unlikely).

If you pay the £600 then have the extra £300 or so by the end of January you will have pretty much paid off Vanquis.

I have a Vanquis also and their statement dates are quite generous so when I get my statement on 20th, I've got until 16th of the following month to pay so you could try and do all your spending on the Vanquis card and pay off the Aqua one - juggling the payments about until you can clear them. Just make sure they are paid with every spare penny you have and you don't resort to bringing them up to the limit as well as spending on your debit card.

You'll be debt free in no time at all :-)

hadahardyear

i was thinking about paying off either aqua one cap one, or both cap ones and using them for spending throughout the month, hence building it back up again and saving on the interest x

I don't theoretically need 4 cards, but i think i like having them as ive not been allowed any form of credit for years, after having a bad rating and they are building it up again

quintwins

what are the acualy interest rates on them?

assuming you can save £500 a month (if you saved £600 and hope to save up to £1000 by the end of the month would you say this was right?) i would pay the £600 towards your Vanquis card then pay the rest at the end of the month at which point you will be £48 better off next month and have £500 to pay your aqua and one of your capital one cards, then you only have one to worry about

i personally would try not to add to them at all, and i wouldn't save if theres money on cards as your interest rate will be alot lower than your on your cards, if you pay your vanquis card this month you'll have it if and amergency arises, once there all clear you can use them for day to do living and pay them off at the end of the month rather than paying interest for the privliege of using them

hadahardyear

thats what im thinking, is paying off the three of them, just using the aqua for day to day then clear again in full next month.

the interest rates are high, 49.9% vanquis
35.9 aqua
cap one 26.9
cap one 30.9

BlushingRose

worries me that you have to use a card for 'day to day'. Does this mean that you're doing what we were doing and needing to use a CC for normal living expenses?

hadahardyear

BlushingRose wrote: »

worries me that you have to use a card for 'day to day'. Does this mean that you're doing what we were doing and needing to use a CC for normal living expenses?

thats what i was doing in the first instance like a lot of people but since i had my lbm a lot of things have changed.

Now i mean day to day living and pay it off in full every month

quintwins

hadahardyear wrote: »

thats what im thinking, is paying off the three of them, just using the aqua for day to day then clear again in full next month.

the interest rates are high, 49.9% vanquis
35.9 aqua
cap one 26.9
cap one 30.9

given the fact the interest rate on the vanquis is higher my advice stands £41 is alot of money to just hand over i'd really make a push to pay it first, i know it seems like a good idea to clear the 3 smaller ones first because then you'll only have one card

if you pay all 3 you will save £17 interest a month, if you pay off your vanquis you will have an extra £25 to go towards the other cards clearing them quicker

quintwins

BlushingRose wrote: »

worries me that you have to use a card for 'day to day'. Does this mean that you're doing what we were doing and needing to use a CC for normal living expenses?

i use my card for day to day living (i have no debt btw) but in order to build up my credit rating, as a rule i never spend more than i have in the bank, also it's helpful with budgetting as it's all in one place, creditcards can be good things if used properly, if not there a timebomb

camuk81

i'm going to thrown in some info off the internet and my figures but please check your own.

hadahardyear wrote: »

Aqua is £324 / £350 (interest is £11.67 pm) APR 34.9%
Capital one Classic £169 / £200 (interest is £2.65, i pay minimum £10) 34.9 APR
Capital One Progress £174/ £200 (interest is £2.65, I pay minimum £10) varies from 29.9 down to 17.9 depending on how long you have had the card open and if you made all payments it reduces by 2% every 6 months
Vanquis £983 /£1000 (interest is (41.25) mine at 39.9% but can go as high as 59.9%

Have put all this into the snowball calculator. It will skew it with a lump so don't enter it.

http://www.whatsthecost.com/snowball.aspx

This should give your overall saving