Clearing a student Overdraft

poor_country_girl

Hi Forumers

I am after some advice for the best way to proceed
I studied for a degree that ended last year, and in the process have ended up with a £3000 overdraft on my student current account. I currently don't pay interest on it but this is going to alter in November with the Halifax's new OD fees
I have really struggled to pay anything off it, but have this week swapped about 6 DD's I had on it to my bill account that is always in credit, and was wondering if the best way to clear the debt on this would be a 0% purchase credit card (at 46 years old i've never actually had a credit card!) then set up a DD to pay this off within the time the 0% is offered, whilst reducing my OD to a very small amount to stop me spending too much (I try to be a frugal shopper, and we don't ever eat out or drink or go on holiday etc)

Any advice would be very welcome!

thanks
PCG

bigadaj

yes, assuming you can get the card and offer then that would be a good way of doing it.


In theory you could make some interest by paying minimum every month, saving the difference and then paying as a lump sum at the end of the deal, but the benefit may be minimal and balance/ term might be easier and more reliable for you.


Just remember not to mix a card with a 0% balance transfer deal with a card that you spend on or you will continually accrue interest.

Candyapple

If at 46 you've never had a credit card you will struggle to get a 0% card.

What you actually need is a money transfer card. Enter your details below into the eligibility checker and see what the results say:

https://creditcards.moneysavingexpert.com/?money-transfers&_ga=2.218155034.2023551412.1506333675-1698003416.1506333675

If the results come back with low or 0 percentages then what you are going to have to do is treat the overdraft as a priority debt.

There is no easy answer I'm afraid. If you are working, asking for more hours. Or get a second job. Or a better paying job. Then throw every spare penny you get towards clearing the overdraft. Yes you will suffer paying the fees every month but gradually this will go down with the payments you will be making.

Have a play around with the figures below to see how long it will take you to clear it:
http://www.whatsthecost.com/snowball.aspx

poor_country_girl

Thanks - will have a look at the eligibility checker - I've never had any problems getting credit for other things, loans etc. I'm self employed at the moment, doing assembly work for another company, and even though I get paid by the item, I am limited by the orders they place as to how much I can potentially earn, then I have an 18mo to look after for the rest of the time, I'm hoping to enroll on a college course this week to make up for the short fall in skills on my degree in order to hopefully start a more lucrative business next year, so at the moment time is as tight as money! (I refuse to put my child into childcare!) I also have an adult daughter who is moving back from university and doesn't make things easy for me money wise!
I've spent years trying to minimize outgoings etc, pretty savvy with my money so far until this blip!
will look at yur suggestions though - thank you!

dresdendave

poor_country_girl wrote: »

I also have an adult daughter who is moving back from university and doesn't make things easy for me money wise!

Surely this will help you. An adult wouldn't expect to live rent free. The money she gives you for board and lodging can go towards paying off your debts.