Cashing in a savings plan to clear debt

huguenot_2

Hi

We have a substantial 4-figure overdraft and we are looking at ways to clear it, and so I'm just sounding out peoples' thoughts on a couple of options I'm considering. We are making a few lifestyle changes to turn this around.

Firstly, we are thinking about getting a credit card with a so many months interest free on balance transfers. This would clear the o/d and we would just pay instalments each month. Then do what Martin calls card tarting and get a different interest fee arrangement elsewhere.

Secondly, cash in a savings plan we have had going for many years. This would clear the o/d and leave us a bit spare left over. The slate would be wiped clean, so to speak. However, it leaves nothing to fall back on when our girls become 18. The eldest is 7 years years away from that age and who knows what may happen in the meantime I suppose.

What would fellow users do in this position?

Many thanks

MG

tyllwyd

It is really difficult to give an opinion without knowing your circumstances. If you can get the debt moved to an interest free deal, that has got to be good (although you will probably have to pay some kind of a balance transfer fee, and I think to move an overdraft you would need to do a super balance transfer, so you might have to make sure you were signing up to the right product when you made your decision).

When you say a savings plan, what exactly do you mean - is it an endowment, or just a savings account - are any bonuses expected, or would you lose out in any other way if you took money out now?

huguenot_2

Hi

Many thanks for your message, and I note what you say about the potential pitfalls of doing a balance transfer credit card arrangement. With regard to your question about the the savings plan, it is one that builds bonuses and is not an ordinary savings account.

Thanks

MG