Transfer or Credit Card

Hi, 
I’ve read the site about the best way to reduce my bank overdraft and the interest that comes along with it, and I see there are two possible alternatives but which is the best option ?
Option 1 : Apply for a Transfer Card to transfer money into my account to reduce the overdraft and manage it or 
Option 2 : Apply for  a 0% credit card with the best possible amount of 0% months and spend money on that so it reduces the out goings from my account so lowering my overdraft 
Any ideas/advice on what is the best option and has anybody else found one to be better than the other or do they carry out the same purpose 
Thanks in advance for any advice
Mancman88

Comments

  • Ebe_Scrooge
    Ebe_Scrooge Posts: 7,320 Forumite
    Name Dropper First Anniversary Combo Breaker First Post
    Option 3 : spend less each month.
    But to answer your specific question, either option would work.  The only thing to be aware of is that a money transfer may well incur a fee, which you'd have to factor in to your budget.
    The other thing is, these 0% offers tend to be given only to those with relatively decent credit histories, added to which lenders are becoming more stringent than ever with their acceptance criteria.  So there's no guarantee you'd be able to get either card anyway.
    Finally - it's no good just shifting the debt from an overdraft to a card, only to continue to live beyond your means.  You need to tackle the root cause of the debt.
  • mancman88 said:

    Any ideas/advice on what is the best option 
    The answer lies in the maths.  

    Which would cost you more - the fee for the money transfer or the OD fees/costs until you get it to zero?
  • Depends on the size of your overdraft and the interest rate.  If it's low then you may be better off to use the 0% on purchases to gradually reduce your overdraft.  If larger then might be better to take the ~3% hit on the transfer and pay off the entire overdraft asap.

    Good lucj
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