credit card minimum repayment?

hot_saver

Hi I am a newbee. Got 2 credit cards - 1 is at max & the other near.
Have done budgeting calculations, cant save any more money as monthly income same as essential outgoings and can only afford to pay min monthly payment - plus a very small amount extra on cards.

My question is: Instead of leaving whats left of my salary - say £400pm in my bank for food etc, should I use this £400 to pay one card, where the min repayment is say £120. then continue to 'use' the 'spare £280 on my card, for my monthly needs. Or should I just pay the min £120 and leave £280 in my bank. ie will I save any interest by paying more to my credit card, but still using it each month??

Bismarck

Hi, you need to use the snowball calculator to work out what's the best use of the spare cash...also depends on how the interest is charges...for example M&S charge you the full interest if you don't clear all the balance whereas a lot of others just charge interest on what's outstanding...need to know the cards and interest rates and also you would be better posting a Statement of Affairs on the DebtFree Wannabee board and they'll help you knock a load more off before it gets trickier...

http://www.whatsthecost.com/ for help on snowballing

CLAPTON

CC charge interest by the day based on the daily balance so yes your plan will marginally reduce your interest.

however you ought to consider ways of increasing you monthly payment .. could you get a parttime job to help?

skyrider007

Pay as much as you can afford and you'll be less troubled.