£4k debt to clear - what's the best approach?

hgm127

Hi everyone,

I was wondering if anyone could give me some advice on how best to approach paying off my debts.

My details are:

Credit Card #1 = £1750
Credit Card #2 = £1000
Credit Card #3 = £720
Overdraft (interest free - graduate account) = £400

Credit cards 1 and 2 are interest free until Jul 2015 and Feb 2016 respectively. The overdraft is interest free until Sept 2015.

My monthly income is £1500 and I can afford to pay about £250 of this towards debt.

I would like to get this paid off as quickly as possible as it's a huge dark cloud.

I know there is a lot of ill feeling around debt consolidation loans. I was wondering if taking out a £4.5k graduate loan would be an idea? Paying off all credit cards and setting up the direct debit loan repayment to come out every month. I would be able to pay off my debt within 2 years if I did that.

Any advice would really be appreciated. Wish I'd never got myself in this mess!

abby1234519

hgm127 wrote: »

Hi everyone,

I was wondering if anyone could give me some advice on how best to approach paying off my debts.

My details are:

Credit Card #1 = £1750
Credit Card #2 = £1000
Credit Card #3 = £720
Overdraft (interest free - graduate account) = £400

Credit cards 1 and 2 are interest free until Jul 2015 and Feb 2016 respectively. The overdraft is interest free until Sept 2015.

My monthly income is £1500 and I can afford to pay about £250 of this towards debt.

I would like to get this paid off as quickly as possible as it's a huge dark cloud.

I know there is a lot of ill feeling around debt consolidation loans. I was wondering if taking out a £4.5k graduate loan would be an idea? Paying off all credit cards and setting up the direct debit loan repayment to come out every month. I would be able to pay off my debt within 2 years if I did that.

Any advice would really be appreciated. Wish I'd never got myself in this mess!

Woh woh woh, why would you take a loan that charges interest to pay off debts that are currently at 0%

Focus on getting the interest charging card paid off or balance transfer to a 0% deal an then just throw as much money at the one that expires earliest. Is £250 all you can pay towards the debts? I mean do you live in your own place etc

Gaz83

hgm127 wrote: »

Hi everyone,

I was wondering if anyone could give me some advice on how best to approach paying off my debts.

My details are:

Credit Card #1 = £1750
Credit Card #2 = £1000
Credit Card #3 = £720
Overdraft (interest free - graduate account) = £400

Credit cards 1 and 2 are interest free until Jul 2015 and Feb 2016 respectively. The overdraft is interest free until Sept 2015.

My monthly income is £1500 and I can afford to pay about £250 of this towards debt.

I would like to get this paid off as quickly as possible as it's a huge dark cloud.

I know there is a lot of ill feeling around debt consolidation loans. I was wondering if taking out a £4.5k graduate loan would be an idea? Paying off all credit cards and setting up the direct debit loan repayment to come out every month. I would be able to pay off my debt within 2 years if I did that.

Any advice would really be appreciated. Wish I'd never got myself in this mess!

You'd be able to pay it off in little over a year at £250 per month with a bit of willpower, never mind within 2 years. £250 a month would take 16 months to clear £4,000.

It is complete madness considering taking out an interest-charging loan to pay interest-free debt.

enthusiasticsaver

No you certainly should not debt consolidate when you have most of your debt on 0% and if you can be disciplined to put £250 per month towards paying off your debt. Pay minimum monthly payments on credit cards and the rest off credit card 3 first, then 1 then overdraft and finally credit card 2. You would have it all cleared by April 2016 then.