Which do I pay off first?

YorkshireBoy

geographygirlie wrote: »

Approximately another £150-200 on top of the £410 I'm currently paying.

Is this cash available now because you've just had a payrise, or finished paying other debts? If not, why aren't you already paying it off the debts?


I don't think you've posted your credit limits yet? This may change things re which card to pay off first.


Have you viewed your credit reports recently?


Any other debts?...loans?...mortgage?

[Deleted User]

An extra £150pm will get it down to 38 months and £6,427 in interest.

An extra £200pm will get it down to 33 months and £5,519 in interest.

Cutting your payments to the lower APR cards (and eventually card), to just above minimum payments, will reduce the period and interest still further.

Out of interest, do you know what the minimum payments are, by percentage of balance?

redpete

geographygirlie wrote: »

some places say pay off the biggest balance,

Not sure why this would be suggested.

some the smallest balance,

Some suggest it can be a psychological boost when you clear a card - so paying the smallest balance will achieve this earlier. Personally I'd rather just save the most money.

some the highest APR

That's the obvious answer, it's costing more for every pound you owe at the highest APR than the others.

some the lowest APR

Can't believe anyone would seriously suggest this.

All the above could be complicated if you have a low interest offer that's close to coming to an end, or if any are above their credit limit, or if any have a high credit limit that you want to release by closing the account, or if any might offer balance transfer offers in the future once you pay some off....

geographygirlie

Bedsit_Bob wrote: »

An extra £150pm will get it down to 38 months and £6,427 in interest.

An extra £200pm will get it down to 33 months and £5,519 in interest.

Cutting your payments to the lower APR cards (and eventually card), to just above minimum payments, will reduce the period and interest still further.

Out of interest, do you know what the minimum payments are, by percentage of balance?

Minimum payment would be about 2% I think

geographygirlie

YorkshireBoy wrote: »

Is this cash available now because you've just had a payrise, or finished paying other debts? If not, why aren't you already paying it off the debts?


I don't think you've posted your credit limits yet? This may change things re which card to pay off first.


Have you viewed your credit reports recently?


Any other debts?...loans?...mortgage?

Pay rise came in September and have just paid off my overdraft hence the ability to pay this much.

Credit limits
Card 1 - 6000
Card 2 - 4600
Card 3 - 5080

[Deleted User]

geographygirlie wrote: »

Minimum payment would be about
Card 1 = £116
Card 2 = £97
Card 3 = £79

Actually, I meant what percentage of the balance, are you required to pay each month?

You see, credit cards have a minimum required payment, based on a percentage of the outstanding balance.

This means, as the balance reduces, month on month, the minimum required payment also reduces.

Knowing what the minimum percentage payment is, would allow you to dedicate more toward the highest APR debt, as the balances reduce.

However, based on the numbers you have given above, the monthly percentage minimum payments are about:-

Card 1 - 2.05%

Card 2 - 2.5%

Card 3 - 1.65%.

If we round these up to 2.1%, 2.6% and 1.7%, respectively, and make the monthly payments accordingly, then the settlement periods and interest will be as follows:-

£410pm - 65 months and £12,341 in interest.

£560pm - 37 months and £6,310 in interest.

£610pm - 33 months and £5,443 in interest.

HOWEVER. Before you consider reducing your monthly payments, you must check a statement for each card, to make certain of the percentage minimum payments.

[Deleted User]

geographygirlie wrote: »

Minimum payment would be about 2% I think

If you are going to reduce your payment to the percentage minimums (plus a few quid), you can't think what they are.

You need to know what they are.

Check your latest statements.

They'll have the percentages on them.

Roland_Sausage

The_Boss wrote: »

Anybody got a link to the snowball calculator? That would help the OP to see.

Download this spreadsheet and have a play with it OP.

You can try out each method and see which one will pay off the debt fastest and for the least amount of interest.

http://www.vertex42.com/Calculators/debt-reduction-calculator.html

I found this to be invaluable a couple of years back when I was trying to reduce debt.

geographygirlie

Roland_Sausage wrote: »

Download this spreadsheet and have a play with it OP.

You can try out each method and see which one will pay off the debt fastest and for the least amount of interest.

http://www.vertex42.com/Calculators/debt-reduction-calculator.html

I found this to be invaluable a couple of years back when I was trying to reduce debt.

Thank you - v useful

YorkshireBoy

Bedsit_Bob wrote: »

Actually, I meant what percentage of the balance, are you required to pay each month?

Barclaycard is interest plus 1% (on the OP's APR)
Ex Egg card (Barclaycard World MasterCard) is the same (I have this card)
Can't find a current summary box online for Mint (they haven't taken new applications for a long time now), but it's likely to be 1% plus interest too.

Perhaps the OP will be back to confirm?