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Debt with savings.

(7 Posts)
Mum2twoUnder4 Sat 08-Oct-16 11:57:47

I'd like to ask, does anyone think it's sensible that even though I have debt, to have a little savings?

I have around 5k debt, am paying off £200pm. But I have £200 in 'savings' basically an emergency account. Is this sensible?

It's just in case the car fails or something goes wrong that I need to fix.

Or should I put that money into paying off my debt?

JenLindleyShitMom Sat 08-Oct-16 12:00:37

Yep sensible. The £200 cushion won't clear your debt in one go. It's much more use to you as an emergency cushion. You're still paying towards your debt as well.

Bagina Sat 08-Oct-16 12:03:03

Interesting. We're doing the same. In reality though, I guess it would be cheaper to put any car fails etc on the 0% credit card, but psychologically we don't want to do that. It's setting up good patterns for us to have a bit in savings, and also be paying the debt down. I guess it depends on interest rates on the debt.

Mum2twoUnder4 Sat 08-Oct-16 12:10:08

Well I am snowballing by debt so it'll take me a little while but I'll get through it all asap.

And I'm putting money into savings each month so I have a little extra for any emergency that may arise. I want to get a £500 buffer and I'll be happy with that.

Think that's too much or enough?

JenLindleyShitMom Sat 08-Oct-16 12:16:03

No I think £500 is a good buffer. I would aim for that then plough everything else into debt repayment.

Mum2twoUnder4 Sat 08-Oct-16 22:14:31

Thank you smile

Mum2twoUnder4 Sat 08-Oct-16 22:15:20

Though I think my £200 will be dramatically reduced once my car has had its MOT next week confused

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