It's the final countdown...£10k to go

mark55man

Don't worry about changing the goalposts from the title.  We're all hooked, and besides, it wont be very long before you are back under £10K - so a minor detour and not a u-turn

Sarahwithlove

Will you still clear your credit card by the end of the 0% period? It's always nice to overpay the loan and see the interest you save can become quite addictive. I keep playing around with the mortgage overpayment calculator and then my budget as a result lol 

t2rry

mark55man said:

Don't worry about changing the goalposts from the title.  We're all hooked, and besides, it wont be very long before you are back under £10K - so a minor detour and not a u-turn

Thanks Mark, that's it - a detour to include something that otherwise I was going to continue ignoring for a few months

mark55man

Over the years I have found that its just more helpful to include everything, I started off just with the CC, then I added car loan, and then mortgage - and a but in the other direction I suppose but added mortgage savings and now EF.  So my signature is a little busy , and maybe its confused people as I've done it, but I always felt better.  Am looking forward to taking CC's off as we go through the year, but EF and mortgage will be running for a while.  Good luck with your new targets  

t2rry

Sarahwithlove said:

Will you still clear your credit card by the end of the 0% period? It's always nice to overpay the loan and see the interest you save can become quite addictive. I keep playing around with the mortgage overpayment calculator and then my budget as a result lol 

Ahh so addictive!! I feel like we're quite similar in that sense, playing around with the budget all the time to see what impact different options have!!!

Yes the 0% on the card ends in August, so it's pretty comfortable to achieve.  If I don't want to be without any savings for a month then I won't pay off the balloon on the car until after I've settled the card.  i should be able to do both with July's payday and have a few hundred leftover to start rebuilding the pot, but if I'm scared of losing the pot then I can wait until it has a couple more months contributions to it first.

I'm actually looking now at whether I could squeeze us this coming payday and pay off the rest of the loan element of the car (around £3,800 - £4,000).  I think it's possible, and would maximise my interest savings on it, but it would leave me with only around £400-£500 in the banked funds for a month and I'd have to pay the minimum off the credit card for these two months rather than my big overpayment.  But an overpayment to the car means more than an overpayment to the card, so I'm really very tempted.  I will get quotes for all the options next month and see, but I'm sure I'll be crunching those numbers a lot in the meantime!

t2rry

mark55man said:

Over the years I have found that its just more helpful to include everything, I started off just with the CC, then I added car loan, and then mortgage - and a but in the other direction I suppose but added mortgage savings and now EF.  So my signature is a little busy , and maybe its confused people as I've done it, but I always felt better.  Am looking forward to taking CC's off as we go through the year, but EF and mortgage will be running for a while.  Good luck with your new targets  

I think that's a really good approach, for me I guess I would have found all of it included together this time last year a little overwhelming, and the end seemed so far off that I just know I would have messed something up trying to be clever and save interest rather than clearing stuff.  Now it's all so close to being achieved I'm more comfortable with those figures.
It's all so psychological isn't it!!!?! 

I have given thought to the mortgage, that's the only thing left after this, and with our disposable income at the level it is, we could really do some damage to it - actually next month it will dip under £200k for the first time, which is nice - but we are also a growing family so as much as I'd like to be the person throwing everything at becoming mortgage free fairly early in life, I'm not sure that'll be happening until we have found more space, one way or another.

t2rry

(I'd also like to get to a point where we don't feel like we should 'manage' with clothes that are falling apart and once this year is over, hopefully we'll get to enjoy some of it a little more too!! What a dream!)

Sarahwithlove

I think I would do it. If an emergency happens its not like you don't have any options available to you. Not ideal but you could in an emergency use your card. How much interest would it save you? 

t2rry

Sarahwithlove said:

I think I would do it. If an emergency happens its not like you don't have any options available to you. Not ideal but you could in an emergency use your card. How much interest would it save you? 

This is true, and I guess even in a really bad emergency situation I should theoretically be able to pay off the card before the bill even comes the following month, so no interest cost.

I think the interest saving on the loan part would be about another £250 if I paid that all off.

But I'm also not sure, because I presume I must pay interest on the balloon payment too, as my settlement figure now (after the overpayment I've made today) shows an interest saving of over £1,300...but the company say I can get the monthly payment down to £0.01 (as you always have to have something paying each month whilst the balloon is outstanding).  

t2rry

okay so I've had a thought...
I asked on the motoring threads about how the interest is calcuated with the PCP, because of my above confusion about how much I'd have to pay to get the monthly down to 1p.
Anyway, there's no simple answer, but someone suggested I should get a low rate loan instead, save the interest that way.
I have reasons I don't want to do that as it feels like using a sledgehammer to crack a nut, when I'll just then overpay the loan in the same timeframe.

I mentioned on here that I'd considered getting a 0% money transfer on the CC to settle the PCP, but that would cost £400 in fee.
What I have only just realised, is that it would work out better if I got a money transfer with no fee but with interest.  I could get that for 3.9% interest.  So no fee to pay upfront, and I'd then be paying 3.9% interest on an ever decreasing total, rather than the PCP 6.8% on the balloon payment balance (£7886) whilst I save enough to pay that off in total.

Paying the CC off at a rate of £2000 per month still has the total paid off by August, but I'll incur only around £100 interest in that time (this I can work out because of online calculators, I haven't been able to find a PCP calculator that gives me the same detail, but surely I'll be incurring way more than £100 interest on the PCP between now and August!)

I hate the idea of adding to a CC I've just got rid of, but it seems like maybe that's the psychological aspect clouding what is clearly the most money saving option!?  What do you think?