Advice on the best way to spend this cash on my debts!

Cat_Rogers

Hi,
I have just recieved £1700 reclaimed bank charges- Thanks to this website! I now need a little advice on how's best to spend the money paying off my debts.
Current state of affairs:

LLoyds overdraft £1300
A graduate account, so I'm being charged interest on the £300 that's over the £1000 interest free allowance.

Barclays overdraft £1700
Another graduate account- my wage goes into this every month but I always end up being overdrawwn to the full £1700 at the end of every month.
Being charged interest on the £700 that's over £1000 on my account.

0% Credit card: £1500
This I'm paying off every month.

OK- so with the £1700 do I completely pay off my Barclays overdraft so that I've got one account that's 'normal'?

Or- do I pay off the £300 that's over £1000 on the LLoyds and pay the £700 off that's over the £1000 on my Barclays and use the rest to get my credit card down?

OR-
Does anyone have a better suggestion?
Any advice much appreciated!

hypno06

how long is the 0% for on the credit card. If this is going to go up to something horrid like 21.9% after an initial period, it would be worth perhaps keeping the cash in a separate account then clearing the card when the 0% runs out.

Otherwise, pay off the £1700 o/d and get one account in credit - then cancel the overdraft and keep it in credit!!

Well done you!!

Seaxwyn

Cat, I would put enough into both ODs that you are not paying interest on any of your debt. Then put the remainder into either the Lloyds OD or the credit card, whichever you would like to pay off completly first.

Cat_Rogers

hypno06 wrote: »

how long is the 0% for on the credit card. If this is going to go up to something horrid like 21.9% after an initial period, it would be worth perhaps keeping the cash in a separate account then clearing the card when the 0% runs out.


The card i've just done a new balance transfer on, so it's 0% for the next 13 months, in which I hope to get the total debt down.
Does that change the situation at all? I'm still not sure what the best way of going about things is!

James&Shell

Id pay it all off the 1700 overdraft nd cancel it you will feel releived that another debt has gone.

Well done for reclaiming

Tashja

I would pay off the £300 & £700 thats on the overdrafts. This would then make your debt interest free. That would leave you with £700 left.

Maybe you could then put this in a high interest savings account until you have enpough to pay off one of the overdrafts or the card.

Hope this helps.

T xx

Seaxwyn

HI Cat, It sounds as if you are in a good position with most/all of your debt on 0% interest. Well done you! So don't stress too much! Get both those ODs safely into the 0% zone and then do whichever makes you feel most comfortable. With a year to pay off your 0% you are very likely to be successful. Good luck!

Storm

I would say to pay it off Barclays as this is the account you use on a day to day basis - at make sure you cancel the OD completely! I was so pleased when I could cancel my OD as I never felt any of the money available was really 'mine' and it was far too easy to use more of it than I'd intended to each month!

Then you'll only be paying interest on £300 of debt, which is fantastic!

raq

I had mine in january and what a joy. I paid with old debts that where sat with an agency and also got a reduction. felt really good paying 3 of . just the uptodate one's left.

well done. oh by the way mine was with Halifax and no problems with any of the paperwork and said "YES" to the first offer.

bandraoi

I would pay off £800 on my Barclays overdraft and reduce the limit down to £1000. The other £900 I would pay off the Lloyds.

With Barclays being your main account, there's more risk of accidentally going over your limit or if you pay the whole lot off, deciding that you realy want something and it's interest free so why not just up your credit limit to pay for it. . . .

The extra £100 overdraft gives you some cushion, but you can't up it anymore without incurring interest which should act as a bit of a block.

Cat_Rogers

Thanks to all of you for your advice!
And to this website for empowering consumers everywhere- what a good feeling it is to really start getting my debts down!