should she pay off debt early

where_are_we

My daughter made a mistake and used her credit card instead of her debit card to buy £200 worth of euros at the post office. She now has to pay the fee for this transaction which is unavoidable, but is it possible to pay off her balance early before her monthly due date and then pay less interest than she would do if she did nothing and let her monthly direct debit pay the debt off as usual.

Roland_Sausage

yes, it would be advantageous to pay if off early, if she wants to minimise the interest paid.

grumbler

where_are_we wrote: »

... is it possible to pay off her balance early before her monthly due date and then pay less interest than she would do if she did nothing and let her monthly direct debit pay the debt off as usual.

It's worth noting that if she pays between the statement date and the due date this payment may or may not reduce the amount taken by the DD. This depends on timing and provider.

where_are_we

Thanks - I assume she can do this online. She has as Nationwide Flex Direct and a Nationwide credit card and has a variable direct debit to pay off the balance in full each month. She got the euros in the post office and has bought stamps there with her credit card which doesn`t count as cash.

bigadaj

where_are_we wrote: »

Thanks - I assume she can do this online. She has as Nationwide Flex Direct and a Nationwide credit card and has a variable direct debit to pay off the balance in full each month. She got the euros in the post office and has bought stamps there with her credit card which doesn`t count as cash.

Any idea why she purchased the euros from the post office in the first place?

A flex debit card should allow commission free withdrawals at visa rate within Europe and with a select credit card for fee free purchases would be much cheaper than any currency change.

grumbler

bigadaj wrote: »

A flex debit card should allow commission free withdrawals at visa rate within Europe

FlexPlus only, not FlexDirect.

and with a select credit card for fee free purchases would be much cheaper than any currency change.

Select isn't the only CC they offer.

bigadaj

grumbler wrote: »

FlexPlus only, not FlexDirect.
Select isn't the only CC they offer.

Fair enough, my mistake I thought they still offered good cash rates still for arm withdrawals in Europe but I'm out of date, I have a flex plus account currently.

The select was just a suggestion, they could have a different nationwide credit card but select would probably be better all round if they qualified for one.

Ben8282

The amount of interest charged will not be a fortune!
You are free to make an extra payment at any time.
However, the fact that you have a full balance direct debit set up and you don't say if the transaction has already appeared on a statement or not complicates things.
I don't know what effect this payment will have on the direct debit. Somebody with a Nationwide card will need to answer that. You must get this right or you may end up paying interest on the entire balance for the next 2 months!
In the absence of specific knowledge regarding Nationwide full balance direct debits I give the following advice.
If the transaction has not yet appeared on a statement, I would suggest waiting until the direct debit is taken thus clearing the previous balance in full and then on the same day making the additional payment to cover the £200 plus the fee. This is the safest course of action to avoid any potential mistake.
If the transaction has already appeared on the statement do nothing and let the direct debit be taken normally. The amount of interest saved between now and the date when the direct debit is taken will not be a significant amount and not worth any potential hassle over the direct debit.

pandora205

Watch using a debit card to buy currency as some banks make a charge for this (if it's not from their own exchange). I always use cash to purchase currency if I can.

zagfles

bigadaj wrote: »

Fair enough, my mistake I thought they still offered good cash rates still for arm withdrawals in Europe but I'm out of date, I have a flex plus account currently.

The select was just a suggestion, they could have a different nationwide credit card but select would probably be better all round if they qualified for one.

It would still have been far cheaper to withdraw the cash at an ATM once abroad, PO rates are appauling for amounts under about £500.

zagfles

Ben8282 wrote: »

The amount of interest charged will not be a fortune!
You are free to make an extra payment at any time.
However, the fact that you have a full balance direct debit set up and you don't say if the transaction has already appeared on a statement or not complicates things.
I don't know what effect this payment will have on the direct debit. Somebody with a Nationwide card will need to answer that. You must get this right or you may end up paying interest on the entire balance for the next 2 months!
In the absence of specific knowledge regarding Nationwide full balance direct debits I give the following advice.
If the transaction has not yet appeared on a statement, I would suggest waiting until the direct debit is taken thus clearing the previous balance in full and then on the same day making the additional payment to cover the £200 plus the fee. This is the safest course of action to avoid any potential mistake.
If the transaction has already appeared on the statement do nothing and let the direct debit be taken normally. The amount of interest saved between now and the date when the direct debit is taken will not be a significant amount and not worth any potential hassle over the direct debit.

My Nationwide CC statement always says:

"Your statement balance, less any interim payments, will collect by Direct Debit on ....". However, if you're close to the DD date you need to be careful.