Am I on the right track?

Freshstart33

Hi,

Finally made the decision to sort out my debts. I have runup £11,000 (OMG) in credit cards and an overdraft, due mainly to the fact thatmy partner has been out of work for a long time. Thankfully now he has somework , although not permanent and I have started a new job with a good wage. Mydebts as they stand are below:


3000 –overdraft

5000 – virgin credit card - 0 % until Dec 2014

3000 – natwest


I have asked a family member to take my credit cards and notlet me have then under any circumstances. I have not missed any payments. Iintend to start with the overdraft and knock that down a bit as I am worried mybank will suddenly demand it back, although they do make a fortune in intereston it and my wage goes in once a month which is over two grand. Of course I will continue to pay my creditcards and extra on the Natwest one if I can. Once my overdraft is down by say£1000 I was going to move onto the Natwest card, leaving Virgin until last asit is currently 0% interest. Does the above sound like a good plan?

Thank you so much for any help, reading the posts has mademe feel better as I do not feel so alone

debt-freeoneday

Hi there

It sounds like you are getting off to a good start particularly now that you have a new job that pays well.

I would work out which debt is costing you the most in interest, whether that be the Natwest card or your overdraft and start with that. I would leave the Virgin card ticking over (obviously making the monthly payment) until you've tackled the others.

Without knowing your total earnings and outgoings, it's difficult to say how quickly you could pay these off, but if you can reduce your outgoings by cutting costs, you could make quite an impact on your debt before you know it!

Good luck!

Freshstart33

Hi,
thank you very much. Yes the overdraft is definetly costing the most at the moment. And as I say I am worried Barclays will sudenly decide they want it back, does anyone know how likely this is? I know I could open another account with another bank but I want to avoid that if I can. Now I have made a budget (and I make myself stick to it) I should be able to pay off between £500 and £600 a month. I am going to try and concentrate on one debt at a time as if I think about them combined I start to panic :sad:

girlatplay

Remember to keep paying the minimums on the other two.

After you have paid some of your overdraft off you could ask your bank to reduce it a bit, e.g. once you have paid off £500 you could ask for it to be reduced to £2500 and so on, takes away the temptation to use it again.

Good luck!

Freshstart33

Great idea, I will do that. They just kept letting me increase it and increase it. Im not blaming them though it is my own fault for letting things get out of hand.

Mort

You are doing the right things, especially not spending on the cards.
I would be wary of asking the bank to reduce the overdraft too soon, just in case they decide to reduce it to an amount you can't cope with.
It is possible to do without an overdraft facility but the transition would be better if you are totally in control.