Pay off one credit card or have savings?

[Deleted User]

I have two credit cards that both have a balance transfer set up on so as long as i pay each month they'll be paid off by May 2021 which no interest as I already paid the transfer fee. 

I'm going on maternity leave soon and I'll still be able to afford all my bills and to pay off the same amount each month but only be left with 200 pound cash a month after this (will have partner to help etc so not a big big deal) 

I've managed to save enough money over the last 3 months during lock down that I can pay off the largest credit card early but then not have any cash savings if needed. 

Not sure what is best to do. Pay off credit card and then have no savings but will have the money each month that's not going to pay off the credit card or keep credit card and use savings slowly each month for cash flow?

We might also be moving house soon if our property sells so don't know which will look better on the mortgage check etc and if cash will be better to have with the fees etc 

[Deleted User]

Financially, you're better off keeping the debt and clearing before interest kicks in.

wiseonesomeofthetime

I would keep the cash savings in as high an easy access savings account that you can (so you get a few extra pennies) if you can clear the 0% BTs before they expire.

Should you clear the one card first using your savings, and then have an emergency, with no cash savings to draw upon, you could then be reliant on using a credit card instead, attracting interest rates higher than your current 0% (I'm assuming you do not have access to a 0% purchase card at the moment here).

All the best for the future, and a healthy new-born😁

planteria

agree with those above.. you've paid the fee, so you might aswell keep 'their' money and generate some interest with it.
as long as you are confident you will not spend on either of the cards, miss a payment or do anything else detrimental, just clear the balance before interest begins to be charged.

[Deleted User]

Okay thanks! Any idea what high interest savings account I should go for? Ideally one that won't lock my money 

blue.peter

Nadia91 said:

Okay thanks! Any idea what high interest savings account I should go for? Ideally one that won't lock my money 

See https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/ .

If you can commit to a regular amount each month, a regular savings account might give a better rate of interest. But do be careful - not all will allow easy access before the end of the year.

[Deleted User]

Help! I used my balance transfer card for new purchases of 400 in order to get points and I paid this off the same day. I didn't realise though that this payment goes towards Mt balance transfer and not to pay off new purchases so interest will build and build!

Is there a way for me to pay this new 400 pound off so I don't get more interest?

Im paying off the balance transfer with direct debit 

[Deleted User]

Your payments will go to the highest interest statemented balance, so will pay off the purchases.

Your mistake was in not waiting for the next statement.