Basic maths question re repayments !

Kev64

I've just made up a nice spreadsheet detailing all of my credit card & overdraft debt, and the interest charged thereon. I'm juggling the money around as best I can, using 0% offers wherever possible, but now I want to target my repayments more efficiently...

Is it cast in stone that I should be paying the most off the card with the highest interest rate, and only the minimum payments on the others ?
...or don't the maths work out like that ?

e.g. I have a £4k overdraft at 19.3% APR, and £5,500 on an Egg card at 17.95% APR (plus others but for the example, these two will do). Would it be better for me to cut my repayments to Egg to the minimum in order to completely clear my overdraft as quickly as possible, then tackle Egg in a similar way, paying the minimum off the other, lower rate, cards. ??

CLAPTON

its generally true that you should pay the minimum of each debt except the one with the highest APR; that way you pay the least interest and clear the debt the quickest.

There are some exceptions... firstly an overdraft... because the amount outstanding fluctutate during the month, the actual interest paid will vary too... but the effect is difficult to work out.
secondly, if your CC are on special deals that will run out soon..

but generally its best simply to pay off the one with the highest APR... and it these uncertain times, clearing an overdraft is probably the best thing to do anyway as they can be recalled an anytime.

Kev64

Thanks very much for that. I've adjusted my repayments accordingly. I've always hated having an overdraft - psychologically it's very negative seeing your bank balance permanently in the red.