overdraft vs credit card, help please

bbford

Hi,
i am on long term maternity leave so need to sort out finances.

I have an overdraft limit of £1,700 and am up to £1200 a month, i also have a credit card with £2,000 on it.

Is it possible to transfer the overdraft onto the credit card account and consolidate the debt , do you think this would be wise.

My husband gives me £1,000 a month for housekeeping, but with 3 small children it's going nowhere fast!

would really appreciate your advice.

angelavdavis

Hi and welcome to MSE.

I think your first step here is to review all the incomings/outgoings in an SOA format. If you look at SouthernScousers post here, this provides you with guidance.

Once you have compiled this, post this up on the forum here and the good folks on here will offer you advice on areas you could reduce your outgoings.

As far as your question is concerned, the answer depends on your credit rating, the interest rate you are paying for the overdraft/cc, whether the credit card will allow you to transfer an overdraft and whether you will be able to maybe apply for a lower life of balance credit card. My answer would be potentially yes, if you can apply for a low life of balance card, as this will protect your interest rate.

Martin has an article here that might be worth reading, but I think you should also post up your soa here so others can help.

What does £1000 per month cover? Perhaps another idea is starting a spending diary and maintaining it for a couple of months - its a real eye-opener and allows you to see exactly what you are spending. I would also suggest you go over onto the Old Style forum as they have lots of great ideas for cutting back the housekeeping costs.

GettingThingsDone

Hi there! Objectively speaking debt is debt and the main figure that counts is the interest rate.

Have you put your figures into the snowball calculator?

Is there any way you can move your debts onto cheaper cards or banks; for example, some banks (A+L?) offer 0% overdrafts.

Any other thoughts on reducing your debts (ebaying etc)? As I'm sure you know, reduce the debt and you get to keep some of the money you're currently giving away as interest (see the snowballer!)

Remember the warning about consolidation, that unless you are careful you risk running up your debts further again.

Good Luck

gtd