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Pay off loan or save?

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Gb908910
Gb908910 Posts: 8 Forumite
Ninth Anniversary First Post Combo Breaker
Hello everyone,newbie here and would like some advice. I have the following debts:
Cc loan of £2200 on 0% for 18 months taken out September 2015.

Loan of £22500 to build loft conversion (now complete). Taken over 7 years at a 3.6% rate,paid 14 months of this.

Now I have come into some money from inheritance of around £21000 and wondering what to do with the money.

Do I pay off the loan in full? Or part pay it and save the rest/invest?

Personally I feel I should pay it off and start saving the £300 per month that was being used for the loan.

I have already paid £4500 in loan repayments.

Comments

  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
    10,000 Posts Fifth Anniversary Name Dropper Photogenic
    I'd put £2k (the maximum) in a TSB 5% account and use that to pay off the cc loan in 18 months.

    What you do with the rest, "depends on how much hassle you want. . In theory you could get a bit better than 3.6% by opening up a lot of different high rate accounts. In practice, that's somewhat of a pain. Whilst financially you would be best off to spread the money amongst numerous high rate accounts, if it was me I'd just pay it all off to be done with it then save what would above been the repayments into a single high rate account. Keeps it simple.
  • Gb908910
    Gb908910 Posts: 8 Forumite
    Ninth Anniversary First Post Combo Breaker
    I am with first direct so could utilise there high interest fixed saver,think it is 6%.
    Thanks,will know more once solicitor sorts out the money.
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