Which debt to prioritise?

WhosWho

Good evening all,
I'm just after some advice regarding my debts. 

Unsecured loan: £15,000 at 4.9% APR. I currently have £10,898.31 outstanding on that and I am paying £281.65 per month towards that. I have never missed a payment and I am OK to continue these payments. 

I also have a couple of credit card debts, however, RBS offered me a 0% transfer deal and I have put the debt onto one card now, so i have £6,650 on there. I have set an automatic repayment of £100 per month towards that.

I have a 0% finance deal for £35 per month elsewhere, but I only have one more payment to make.

How would you be focusing your money on paying the 2 above debts off. Should I be paying the minimum on the credit card as its 0% (and maybe put the balance on another 0% card when it ends). Then put all of my "extra" money into the loan to pay that off sooner to keep interest as low as possible? 

Thanks

DayDreamerandGeneralWaster

It really depends on what you think will help you most.
Paying off the higher interest rate loan seems logical. But the card is smaller and could be paid quicker. How long is the 0% deal? The other thing to consider is will the debt need shifting to another deal and if so will there be a 0% available then.

zwilcoxen

Personally. Get rid of the third finance deal. It is always easier to work things out with less in play. 

If you are paying 0% on the credit card I would pay the minimum on that for now and focus every penny on the loan. Then when your 0% deal is coming to an end (2-3 months before it ends) look around for a transfer deal if it is needed.
If you can pay more off the loan and it is currently charging interest then try to drop that down. 

Just be sure to pay the card off or switch before the 0%ends. 

BabyStepper

I'd recommend overpaying the loan first as it is charging you interest. However, it would help us to know when the loan ends, when the 0% deal on your cc ends, and how much you plan to overpay every month. 

zippygeorgeandben

If you use the snowball calculator (whatsitcost), put the 0% CC debt into it and work out how much you need to pay each month to clear the balance just as the 0% runs out (this is what I did anyway).  I was tempted to throw more money at this debt when available but actually I didn't and decided to put the 'surplus' money I had into an emergency fund. 

Worst case scenario - you set up £100pm to clear the 0% card each month, so let's say for example you pay £100 on 31st July but decide to throw another £150 payment towards it.  Two days later, car has an issue and it costs £150 to fix it.  You haven't got that money because you threw it at the debt, when you actually didn't need to.  Make sense?

WhosWho

I'm not exactly active on here... but just thought I'd post my progress - just because I'm pleased with myself and I feel like telling the world.

Fast forward 17 months and this is my current situation.

£3,500 left to pay back on the £15,000 loan (I had 11k to pay when I first commented) 

I have £3,250 left to pay on my credit card (it was £6,650 when I made this post) - I transfered the balance to another 0% card. 

Other smaller bits are paid off.

Total outstanding debt it £6,750

😀

EssexHebridean

You’ve done so well! Brilliant work - when do you expect to reach your debt free date? 

Thanks for updating too - it’s nice to hear how things work out for people! 

Andyjflet

Great work, soon be debt free, I'm on a similar path.

BabyStepper

Excellent progress, OP! Well done!

WhosWho

Just thought I'd update this for people looking for inspiration!

Paid off all of this since my last comment and now have 50k in savings towards a house.

Genuinely feel so much happier since paying it off and haven't borrowed anything since.

If anyone struggling is reading this, just hang in there. Keep focusing. It's well worth it in the end. Good luck all.

EssexHebridean

Thank you for coming back to update us, and well done!