Pay Back 0% Card or Save in ISA

tommer82

Hi People,

I recently I did a balance transfer to a Barclay card with 36 months interest free.

I owe £7200 (from renovating a house) and am now in a position to start clearing this card, I aimed to do this in a year paying around £600pm.

Would I be better paying the minium of £130pm and then putting the remaining £470pm a month in an ISA and/or savings account so i can reap the interest then when it gets to the end of the 0% interest period of the Barclay card paying it off in one hit?

Thanks in advance.

MallyGirl

yes as long as you are very disciplined and will still have the money available to pay off the balance just before the 0% ends.
Maybe some sort of regular saver account?

tommer82

Thanks MallyGirl,

Good tip about the "Regular Saver Account" from my quick look I can see that the interest rates do beat out the ISA by a long way.

Cycrow

Also consider current accounts, many offer better returns than an ISA (even with the tax)

ricky_v

Open the 6% reg savers with HSBC/M+S/First Direct (all require a current account but FD pay £100 switching bonus)

Assuming the market is the same in 1 year, when the reg savers mature put the money in TSB 5% and Nationwide Flex Direct 5% for 1st year, open up a new reg saver and carry on until 0% ends when you can either BT onto another 0% card, or pay it off in full.

It takes a bit of work, planning and dicipline, but there's several hundered pounds there if you do it right (should be even better with the savers' allowance from next year)