savings and debts

Hi Martin or anyone else who can help?

I've just been reading the savings fountain plan and the first step is to pay off your debts, which after taking a deep breath I have organised repayments of by business loan and student loans oh and my egg card but there's not a great deal on there (bit of a pain considering i'm not involved in the business anymore but it was in my name so I have to pay) I do feel so much better as I feel that I have my finances in control. However I am doing an MSC in September and do have to pay for 60% of the course which I want to start and save some money to oneside for, but also I feel that I should start and get some sort of savings underway as I would like to get my own home instead of renting, and I also feel that I should have some form of emergency fund in place.

I would like to be debt free by the time i'm 40 (5 yrs) and more or less should be but I just feel that I don't want to wait all that time before I should start saving, what would you suggest? should I start and save a little bit or focus on paying all my debts off?

Also what do you think of the new savings plan called The Saving Gateway which the government is testing in certain areas?

Your replies would be very much appreciated
Thanks

Comments

  • Xbigman
    Xbigman Posts: 3,884 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    I've always had the view that you must pay off all debts before bothering to save. If you want a house you will find better lenders want to see a deposit that is real and not a deposit that is offset by debts.
    Regards




    X
    Xbigman's guide to a happy life.

    Eat properly
    Sleep properly
    Save some money
  • Apart from having a mortgage, it is always best to pay off any other debt before you commit yourself to any serious savings.

    You will always be paying more interest on your debt than you will be earning on your savings.

    The only exception to this is if you are moving your debt around the 0% credit cards.

    When you do start looking at savings it is worth having a fund to cover all your outgoings for at least 3 months. More, if you can afford it. In the event you lose your job and/or your income - it may take you 3 months to regain it back in another job or means of income (or even longer).
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