The Lemon Fool

Hi All
I had been thinking of doing a bit of an update and I couldn't find you, but this is were you are hiding

My situations today is

Debt:
£2458.35 on barclaycard at 15.45% monthly payment£250
2011.95 0n Bank of Scotland at 22.70% monthly payment £300

Savings:
£1000.00 savings account
£700.00 cash fund
£700.00 emegency fund

Not sure if I should put the cash fund into paying off some more of one of the cards?

With best wishes to you all
Lizzy D

Snorvey wrote:An instant return of between 15 & 22% sounds appealing to me!

The only caveat being that if someone spends all the cash liquidating debts, what rate of interest would be payable if they had to borrow again to meet some unanticipated expenditure? Credit cards with annualised interest rates in double figures are cheap relative to payday loans with interest rates in triple or quadruple figures.

Alaric wrote:

Snorvey wrote:An instant return of between 15 & 22% sounds appealing to me!

The only caveat being that if someone spends all the cash liquidating debts, what rate of interest would be payable if they had to borrow again to meet some unanticipated expenditure? Credit cards with annualised interest rates in double figures are cheap relative to payday loans with interest rates in triple or quadruple figures.

Yes, but, they have two credit cards, which would now have some head room on the credit limit, because some of the amount had been paid off.

I.e. if Lizzy took the £1000 savings and £700 cash fund, paid most of the BoS card off, next month the payment would be something like £20 maybe? So the £280 of the usual £300 monthly payment would pay nearly all the rest off the following month. Then if there was a bigger than £700 emergency, no need for payday loans (agreed, spawn of the devil), the BoS card must have a credit limit of at least £2012, and would give a month or so interest free before being 22%.

So, unless the savings are for something in particular that's going to be needed, throw a big wedge at the credit cards. That, of course, then snowballs, as you have £300 more a month to pay off the other card in a month or two.

I think the OP was looking at potentially using, in her words, the cash fund, that being the £700.00 cash fund, thus leaving the savings fund and the emergency fund intact.

Other than that, we have insufficient background information about her affairs to know what is sensible. Certainly a great improvement on http://boards.fool.co.uk/the-rest-i-thi ... 33715.aspx but it has been a long time since we have seen a:

http://www.stoozing.com/calculator/soa.php

Hi Lizzy,

Good to see you over here too
Remind me, what is your accommodation situation? How old is your car? (What I am trying to get a feel for is, how likely are you to incur such large expenses in the near future?)

LadyG

Nice to see you again Lizzy, glad you've found us!

This is not an 'expert' opinion, it is just 'my' opinion. You are paying high interest rates, the Bank of Scotland card in particular is an 'ouch!'. I'd immediately use the Cash Fund (and indeed as much as possible of the emergency fund and savings too) to really hit those cards, reduce the amount of interest you are paying each month and give you a jump towards getting them cleared altogether. In doing so I'd be relying on being able to use the cards if some real emergency came up, so I'd only leave myself with enough cash & savings for anything I was expecting to come up and absolutely knew could only be paid by cash or bank transfer i.e. cards would not be accepted.

Having said all that I am a one person household (no point in counting the cats as they only take and never contribute!) and it is much easier in a one person household to make radical decisions of this type and also to have a clear idea of what might come up which would require a non-card payment as there is no one else involved.

Thank you for your replies and thank you Pink Dalek for linking back to a past post, I was interested to see how things were then.

After the landrover died we did buy a car and it has proved a lot cheaper to run, unfortunately I never actually managed to sell the landrover so had to first pay back the loan we used for the car. The landrover is still at the garage with no engine!! I had started to save to get it fixed hence the cash fund, but I think the cost of repairing it is going up faster than I am saving. Hence why I am now thinking of using this money to pay off some of one of the credit cards.

Since ChristmasI have also had a pay rise so I could increase my payments now as well Or save more.

In reply to the question about my accommodation and car we live in a tied house and my car is 10 yrs old.

There is now just myself and my husband living at home with my boys both at uni, I have been subbing them a bit but both try and work through the summer to increase their funds. My oldest son finishes this year but is carrying on to do a PHD. He will be looking to buy a car soon so is trying to save.
We still have four dogs and two cats.

Whilst writing this I have decided I will pay the £700 off of the Bank of Scotland card and also increase the payments on this card. Now of to use the snowball calculator to see how this will effect my end payment date.

Thank you again
Lizzy D

lizzydripin wrote:The landrover is still at the garage with no engine!! I had started to save to get it fixed hence the cash fund, but I think the cost of repairing it is going up faster than I am saving.

It might be worth just selling the Land Rover as it stands. There seems to be a great demand for Land Rovers in any condition from enthusiasts, and I'm sure there would be plenty who'd positively welcome an engineless one so they could spend lots of happy hours restoring it.

Suggest you keep the original engine with your Land Rover.
That would maximise value even if not running currently.
Google some prices on classic car websites, you may be pleasantly surprised.
Good luck

Hi Minesadouble and Clitheroekid,

We did try and sell it at the time and had no luck, that was about 18 months ago and it has sat out waiting for repair at the garage. unfortunately the engine had already been removed by this point. Do you think things have changed since then is it worth another go. Should I try advertising.

Many thanks
Lizzy D

My son, a landrover fan, was inundated with enquiries when he was selling his just a month ago - he used gumtree. He had planned to restore it but made a good profit by selling it for parts and is going to buy a better one next time. Nice to see you back Lizzy.

Good to see you again, Lizzy! Good to see the debt is going down, too.

A neighbour here has a scruffy old Landrover in their yard, someone tried to steal it the other day. They seem to be well in demand at the moment. Do try to sell it, it will be off your mind then as well.

Have you looked into balance transfer cards? That is a high rate of interest you are paying. There are offering transfers with no fee these days

http://www.moneysavingexpert.com/credit ... insburys28

What subject is your son doing his PhD in?

T

Re the Land Rover, have you looked at Landyzone.co.uk? They have a For Sale area and some knowledgeable enthusiasts on the forums who might be able to help you dispose of it.

Hello T,

Good to see you too

I am thinking of putting the landrover for sale as is, think we will get next to nothing for it though as it needs so much work. It is still at the garage where it went to be fixed only I have not had the money to fix it. I will have a look at Landyzone, thank you for the link Wrenchasen.

I have thought so many times about doing a balance transfer then just not actually doing it, as it is all in OH's name so he would actually have to do the deed or I would have to move it into my name. Will have another look although I think I have left it a bit late!!

My son is doing physics and graduates this July he the starts his PHD about 4 weeks later, I am very proud, he works hard. Youngest is now studying film set design. Daughter still teaching.

Hope everything is good with you and TJ

Lizzy