What to use in what order? - Hard earned cash or Credit cards?

CatFlap1_2

Hello Experts,
Can any one tell me the best way to spend my own savings and with Credit cards on big purchases?
I need to fit a new kitchen and furnish my first house - lots to buy!
My current money situation is -

* £2300 on a Virgin Credit Card: Balance Transfers 0% until Feb 2009, 0% on purchases until Feb 2008. I am paying off the minimum each month.
(I recently transferred this debt from my Egg Card which I no longer use)

* £9000 Savings in a high interest account.

* £2000 in my regular bank account

How do utilise my money in the most effective way?

- Do I pay off the majority of my Virgin Credit Card with my Current or Savings account?
- Do I apply for a 0% on purchases credit card and use that as a safety net incase I over spend on the house over my £9000
- Do I use a 0% purchasing card to it's limit and keep my savings in my high interest account?

... Its a bit of a Juggling act - can any one advise me how to tackle it and skirt round the pitfalls?!!

Thank you so much!

missile

Get a Capital1 card and earn 4% cash back on your purchases, for 3 months and pay the balance in full.

I guess you paid a fee for balance transfer? Have you worked out precisely how much "extra" you earn in savings on £2300 after tax? I would suggest it is not much ...........

The biggest pitfall to avoid is speading more than you can afford and building up a debt you may have trouble paying once the stoozing offers run out.

lisyloo

* £9000 Savings in a high interest account.

* £2000 in my regular bank account

This sounds like a lot of money being taxed (even taking off the £2300).

Sit down and work out how much "emergency" money and "float" you think you need.
This is more of a "comfort" thing rather than maths.

Personally I keep 4K but I have a partner and so we would probably always have one income coming in.

It sounds a little too high to me.

If you are a tax payer then consider opening an ISA and putting some money in there to keep your interest free from tax. In fact you can still regard ISA money as "emergency" money, because as long as you have it in an instant access cash ISA then you can get to it any time (the intention would be to save it but it is accessible in an emergency).

missile

OP is about to make a huge dent in those savings

fit a new kitchen and furnish my first house - lots to buy!

duchy

I'd look at using a cashback creditcard too in your situation as you have funds available to clear the balance each month. I'd also be talking to suppliers/trademen about discounts for cash and checking out sites like Quidco and Rpoints for suppliers who do cashback. I'd look at each job seperately to work out which is the best supplier/way to pay as it will vary.
It might be useful to keep spreadsheets to record your estimates for each job and calculate which come in over or under budget so you keep a realistic eye on where the money is going and where the surplus/shortfalls are going in the overal project.

21castlehill

Don't forget DO NOT purchase anything on your Balance transfer Card or you will suddenly be paying interest on those purchases from March 08 until you pay the card off.

lisyloo

OP is about to make a huge dent in those savings

Oops, sorry, not the right advice for this situation.