Buying new furniture - cash or "interest free"?

pjapk

Having moved house a year ago we've held of buying new furniture until we sold the previous house (were lucky enough to /just/ manage to buy without having to sell immediately which means we got the house we wanted). We're now lucky enough to have sold it so am now on the lookout for furniture but I can't help wondering if there's any benefit in tying up our cash over taking the finance? I heard that there isn't much "discount for cash" available anyway so is it more financially savvy to stick the cash in a dedicated DD account & slowly let it drip-feed out?
Although we have a mortgage I've worked hard to pay off lots of debts (including £19k of previous CC debt now down to £1800 remaining interest free until the end of it) so would feel happier without adding more debt, unless it financially makes sense?

I did enquire about purchasing on my cash back card but it only pays a paltry 0.5% so hardly worth it.

For scale we're shopping for sofar/3-piece, bed & some Oak living room furniture (sideboard etc.).

Thoughts?

Paul

[Deleted User]

How much will you get on your savings compared to the 0.5% cashback - bearing in mind they will dwindle as you repay the finance?  

On a wider note, if you have other credit ambitions, I wouldn't be fiddling around 0% furniture deals.  You'll also find furniture at lower prices where they don't offer 0% finance, as you're paying for it in the price of the goods.

Shakin_Steve

If you buy the goods on interest free credit, you can settle the finance at any point throughout the loan period without penalty. Years ago, we bought from DFS. The finance was through Creation over 48 months and we paid it of after 18 months. It's really down to what suits you but, remember, a credit check will be done to test the affordability.

Shakin_Steve

As an aside, I asked about discount for cash, but got nowhere.

onlyfoolsandparking

Or you could do as I did and 'find' the manufacturer who supplies places like DFS, SCS etc and buy exactly the same sofa for a third of what the big companies charge which is of course why they can 'offer' 0% finance as the £600 sofa is 2K in their shiny sweet smelling showrooms.  

lcc86

For stuff like this, provided you have good credit, I'd really say it's personal choice given the finance offers are usually 0% or thereabouts. I recently bought a sofa from dfs, was going to do finance but the other half preferred to pay outright. As you're buying a few large items finance may be "better" as you don't have to part with so much upfront and you'd still be able to pay it off further down the line if you change your mind.

MallyGirl

At the moment there is so little interest to be had that it might be as easy to pay from savings and keep life simple

macman

I'd have to disagree. With so little interest available, you need to maximise whatever you can get. You can get 1.16% on your savings, minus 0.5% lost in cashback, which means you are still 0.66% ahead using interest-free credit.
And then you will still have the cash available for your emergency fund, if needed.

ratrace

I would just pay cash and get it out of the way, we have to get out of this mindset of being in debt irrespective of the deals outthere, you have had £19k worth of debt which you have paid off which was a hard long slog, do you really want to keep getting in debt, this covid stuff has taught me a valuable lesson. We dont know whats around the corner especially with the furlough coming to an end, and the less debt we the better imho, sorry to sound harsh but ive been in debt and im never doing it again. my advise is avoid debt at all costs and get in the habit of buying things outright.

pjapk

As an update to this, I did end up just paying cash - no discounts to be had apparently - as others have said, to keep things simple. In my mind, keeping the cash aside would ONLY have been to get a little interest, nothing to do with keeping it for "emergencies" as even in an emergency I wouldn't consider that cash mine to spend anyway. On balance, the tiny bit of interest on it wouldn't' outweigh the overhead of managing it etc. & I feel far more comfortable seeing my debts disappearing, and staying that way.
Thanks all!

bradders1983

Surprised they didn't even knock you a tenner off for not taking the 0% option, given the furniture company would have saved money by you not doing so.