Consolidating Payments

keldar89

I have a small-ish debt to pay off which is not too concerning right now, I would just like to get on top of it as it's niggling right now.

I have the following outstanding payments:

£2,800 on a credit card (@ 0% APR until Dec 2015, but only a £3,000 credit limit)
£500 on a personal loan
£1,000 overdraft (which will be payed in a week or two when I get paid)

So, all in all - a maximum of £4,000. I am considering taking out a £4,000 loan over two years to just get on top of it and pay it all back.

The credit card is my main concern. It is 0% so it is not worrying me just yet, but I just don't like the stigma of having a "credit card bill" - it is not very attractive and I would sleep better at night if I did not have one. A loan is far easier to manage in my opinion as it is just one lump sum.

Unless anybody has any better advice of course? This seems like the best option for me.

redpete

keldar89 wrote: »

£500 on a personal loan

Is this a loan from a freind / family member? If so are they wanting it back now? Generally it is a good thing not to owe freinds/family money so I understand why you would want a loan from a bank to replace this.

£1,000 overdraft (which will be payed in a week or two when I get paid)

If it's getting paid off in a week then why worry about it? Or are you expecting to go into the OD again over the next month?

The credit card is my main concern. It is 0% so it is not worrying me just yet, but I just don't like the stigma of having a "credit card bill" - it is not very attractive and I would sleep better at night if I did not have one.

There is no stigma in having a CC balance, especially as it is interest free for another 12 months and you are presumably keeping up the minimum payments. I think it would be daft to take out a loan for maybe something between 7 and 15% whilst this is interest free.

A loan is far easier to manage in my opinion as it is just one lump sum.

I never understand this, especially in cases like yours where there is only one interest bearing loan and only two others.
It would seem to me worth getting a loan to replace the OD (if it won't be permanantly paid off in "a week or two" and it costs more than the interest on a loan would) and the personal loan (if you are happier not owing money to freainds/family).

CLAPTON

keldar89 wrote: »

I have a small-ish debt to pay off which is not too concerning right now, I would just like to get on top of it as it's niggling right now.

I have the following outstanding payments:

£2,800 on a credit card (@ 0% APR until Dec 2015, but only a £3,000 credit limit)
£500 on a personal loan
£1,000 overdraft (which will be payed in a week or two when I get paid)

So, all in all - a maximum of £4,000. I am considering taking out a £4,000 loan over two years to just get on top of it and pay it all back.

The credit card is my main concern. It is 0% so it is not worrying me just yet, but I just don't like the stigma of having a "credit card bill" - it is not very attractive and I would sleep better at night if I did not have one. A loan is far easier to manage in my opinion as it is just one lump sum.

Unless anybody has any better advice of course? This seems like the best option for me.

so you owe 4,300 in total
when you pay off the OD with your salary what will the OD return to at the end of the month?

it makes no sense to pay off the CC if you have 12 month more at 0% with a loan costing interest

how much is your debt reducing by each month?

the only way to pay off debt is to pay as much as possible each month and pay as little interest as possible


do you have a proper budget ?
start to keep a spending diary and write done absolutely everything (everything : a cup of coffee, magazine, haircut ) and see where the money goes.

keldar89

Thank you both of you! All of that is some really awesome advice.

In reply to some questions:

redpete, when I said a personal loan - I meant a bank loan sorry. It was just labelled as a "personal loan".

I think the best bet would be to pay off just the overdraft. I do not plan on entering it again, so it will be good if I can get in a better position to pay it off so I do not enter it. That way, I can use my salary to pay off the credit card bill.

The personal loan ends in February, so any money that was going into that can start going into my credit card.

Thanks both - this has been a HUGE help .