Debt (Credit Card) Help!

Mystery87

Hi all,

I have been reading these forums along time and taken in some great advice already.

I am currently in the process of trying to "snowball" my credit cards to pay them off starting with thie highest interest rate first.

Before i start i am hoping someone can help me with a few questions below:

1. Did any of you ensure you had an "emergency fund" before you started to throw every additional penny you had at your highest rate card?

2. Do you pay off your cards manually each month (I currently have 5), or do you set up SO and change them evry month (or 2 months,3 months...)?

3. I know there are a few calculators around (e.g "whatsthecost"), however does anybody know of a calculator where I can enter my minimum payments as X% of balance plus interest for the month, as two of my cards have minimum payments such as this as opposed to the traditonal X% of balance as a minimum payment.

Thank You In Advance

Tixy

1) I didn't but I has 2 cards that were open to new spending that in theory I could have used in an emergency.

2) I pay the minimum by DD and then made manual payments on top.

3) What I did for mine was to work out what monthly % the APR was equal to
e.g. for a card with an APR of 20% this is equivalent to 1.53% per month plus if you also have to pay 1% of balance - therefore the minimum payment would be 2.53%.

To work from APR to monthly interest rate use this calculator - http://www.stoozing.com/mon2yr.htm

Nickyj

I didn't have an emergency fund but in hindsight I wish I had. Things cropped up that needed fixing and I didn't have the means to pay to for these emergencies. It would be beneficial to have something in the emergency fund as you just never know when you will need it (that's just my personal opinion though) Good luck with getting rid of the debt!

Mystery87

Thank you for the quick response both.

I think I will save a small emergency fund as per Nickys suggestion,because even though some of my cards are still open,somethings do have to paid by cash.

Do you think its worth setting up a SO for £1 ontop of the DD for the minimum payments,as ive heard you get minimum payment markers against your credit report if you only pay min payment or is that just rumours?

Thank you for the suggestion to question three Tixy,however of hasnt worked because ive just noticed the minimumpayment is 1percent/£5, plus the interest. I presume there are no calculators that can accomodate?

Thanks again.

sistafromanothermista

Mystery87 wrote: »

Hi all,

I have been reading these forums along time and taken in some great advice already.

I am currently in the process of trying to "snowball" my credit cards to pay them off starting with thie highest interest rate first.

Before i start i am hoping someone can help me with a few questions below:

1. Did any of you ensure you had an "emergency fund" before you started to throw every additional penny you had at your highest rate card?
I DID, I THINK IT WAS AROUND £1000
2. Do you pay off your cards manually each month (I currently have 5), or do you set up SO and change them evry month (or 2 months,3 months...)? MINE ARE SET UP MIN PAYMENT BY DD THEN A STANDING ORDER FOR THE ADDITIONAL PAYMENTS



Thank You In Advance

See mine in red.
I think having an emergency fund is vital. I have a few...
1 main one then a few small. One for water bill, one for car (MOT) and a small christmas fund.

Nickyj

I agree with sistafromanothermista, I also set up SO for additional payments.

iclaudius_2

Mystery87 wrote: »

I think I will save a small emergency fund as per Nickys suggestion,because even though some of my cards are still open,somethings do have to paid by cash.

Definately set up an emergency fund. I sold things in order to build it - 500-1000 means you can CUT up those credit cards and still sleep at night. You don't need credit cards. Anything can be paid for using debit these days. There's just no reason and the temptation is a killer when you are living frugally.

Mystery87 wrote: »

Do you think its worth setting up a SO for £1 ontop of the DD for the minimum payments,as ive heard you get minimum payment markers against your credit report if you only pay min payment or is that just rumours?

Thanks again.

DM me if you want a simple excel sheet to plug your repayments into. It's nothing fancy but it works!

good luck