Payments to become debt free!

beckylou77

Again, due to my ostrich nature of years gone by, I'm not sure I know the APR. Is there a rough value to use for ease? Or, failing this, how can I find out?

Fortheloveofmoney

It will tell you on the original loan paperwork. Failing that you could call the companies and ask.

You Should also ask if they apply any penalties for repaying early.

robpw2

im guessing most people have missed the point but this person is not needing to cut back as even after paying all bills and debts they are still £778 in credit ,

they want to use some of this credit to pay off some of the loans and want to know if they should give each company a bit extra ,,,, or pay off one loan ....and then pay off another and so on ..

I would say you should increas the payments on all amounts because then when you ahve payed one off . you can then up the amount and so on and your paying all equally

or option 2 is to put away in a seperate savings account £250 a month (this will leave you with £500 to spend on watever) and then keep doing this untill next year when you wil have paid off two of your loans completly (clear)

in 10 months time you will have £2500 to use... then try to clear off if you can the 4 year loan leaving you just the 7 year one /

Fortheloveofmoney

robpw2 wrote: »

im guessing most people have missed the point but this person is not needing to cut back as even after paying all bills and debts they are still £778 in credit ,

they want to use some of this credit to pay off some of the loans and want to know if they should give each company a bit extra ,,,, or pay off one loan ....and then pay off another and so on ..

I would say you should increas the payments on all amounts because then when you ahve payed one off . you can then up the amount and so on and your paying all equally

or option 2 is to put away in a seperate savings account £250 a month (this will leave you with £500 to spend on watever) and then keep doing this untill next year when you wil have paid off two of your loans completly (clear)

in 10 months time you will have £2500 to use... then try to clear off if you can the 4 year loan leaving you just the 7 year one /

This is why she has been advised to use the snowball calculator. It will show her how much interest she will pay on each debt. She will then be able to make an informed decision on the best way forward. This could be paying them off equally or concentrating on the highest APR debt first.

It's how lots of people have managed to pay off large debts. Myself included.

beckylou77

The snowball thing is interesting! Upping my total payments by £100 over the four will pay off all loans in 28 months! Fab, much better than the 7 years I have remaining! Thanks for all the fab advice there.

FTLOM.... wow, I'm impressed with the speed of paying your debts off!!!

Yes Rob, you are right. Ideally I could be debt free in a much shorter time if I cut back on things but as you have seen, I am in quite a bit of credit at the end of the month and after living like a saint to get £13k paid off in the last 18 months I am happy to be able to have some luxeries. I want my sky and my broadband and my normal shopping (I don't think £200 a month is bad for 2 of us anyway!)

Fortheloveofmoney

beckylou77 wrote: »

The snowball thing is interesting! Upping my total payments by £100 over the four will pay off all loans in 28 months! Fab, much better than the 7 years I have remaining! Thanks for all the fab advice there.

FTLOM.... wow, I'm impressed with the speed of paying your debts off!!!

Yes Rob, you are right. Ideally I could be debt free in a much shorter time if I cut back on things but as you have seen, I am in quite a bit of credit at the end of the month and after living like a saint to get £13k paid off in the last 18 months I am happy to be able to have some luxeries. I want my sky and my broadband and my normal shopping (I don't think £200 a month is bad for 2 of us anyway!)

Yes it is isn't it? I find it a real motivator.

When I started my journey my original DFD was Sept 2010. With some sacrifices (but still allowing a generous £137 per month spends, clothes and hair cuts budget) I've brought this foward to the end of May this year. I can't wait!!!

I found that allowing myself a generous 'me' budget has kept me on the straight and narrow and I haven't gone off the rails at all. This approach seems to work for me with life in general. If I try to be too strict with anything I achieve nothing but if I go along at a slower rate I get there eventually.

beckylou77

Well done you. I am getting addicted to this!!!!!
Yes, I think I will opt for upping my payments total payments by £100-£200 which will still allow at least £500 to spend and help me to build up some savings. I understand the point about savings but there is that little bit of a desire for security! :0)