Credit Card debt to Overdraft - or just pay of Credit card

Westie983

Hello,

I have got myself in a bit of a pickle. which one will be the cheaper option.

I have a CC debt of £1300, Which is charging my 12.95% interest.
I have access to 2k in my OD, I haven't gone into it yet but when I do it charges me £15 a month

Would it be wise to pay off my CC with my OD, or just pay off the CC as I haven't got the OD fees to pay? but pay 12.95%....

My last Credit Card bill didnt have any interest applied as I paid it off in full, but my next statement shows approx £25 in interest.

That in mind it would be cheaper to use the OD and only pay £15 fee...?

I have other credit cards which have debt on 0% so I am just concentrating on getting rid of this...

**my savings in my signature I only have access to £750 of it as the rest is locked away...

stepuptothepl8

Hi Westie :hello:

I'm not going to try and do the maths, but how long would it take you to pay off the card in the ordinary way? FWIW, I'd probably try and not use my OD. If you've only got £750 in accessible savings I'd keep that as an emergency fund. Use whatsthecost to estimate how long it would take for you to pay off the card, and how much total interest is payable. Then work out if over the same period of time whether your OD would be cheaper.

(That makes sense to me.. But reading back it might not be clear.. Oops )

thmaga

12.95% APR should equate to around £13-£14 of interest a month and this would decrease as you pay off the balance.

The overdraft's fixed £15 fee would cost more.

Is doing a balance transfer to a 0% card an option?

Westie983

Step I would hope I could pay it off over the next four months before september.

Thmaga Thanks for the working out, the current interest on the credit card is £16, this month, but like you say this will decrease as I pay it down.

No change of a 0% atm I have just done one to use the rest of my B@rclaycard balance... so I dont have any room anywhere at cant get any more as my limits on my credit cards exceed my annual income.

looks like I will have to see if I can reduce what I'm paying into my regular saver for a few months, to pay down the credit card then increase them again.....

Thanks

Butti

Virtually always worth paying off debt before putting that money to savings due to the high interest rates for credit cards and non - existent rates for savings.