Credit card debt - advice on best approach

[SnowdropEirlys]

I'm facing £20k of credit card debt across 4 different cards and determined that this is the year that I will clear the balances. Balances are;
£11k
£800
£6k
£5k

I've been in denial and spend far too much, have ignored the total balances for too long, and just paid the minimum amount per month for years.

I'm now in the fortunate position of a temporary contract that pays well which should go on a few months so have the opportunity to pay off almost 4k a month, as long as this contract continues.

I'm willing to change my lifestyle, change my spending habits and will quite enjoy the challenge of finally bringing these balances down - I think the relief of seeing them finally come down will spur me on.

I'd be grateful for advice on how best to tackle this. Should I chip away at each balance, or aim to bring the largest down first?

I'm not sure that I want to take out a consolidation loan which means I will be paying less per month for longer, years even - I'd rather just tighten my belt for a few months and blitz this, once and for all, now I have this opportunity.

I'd be grateful if anyone has any other suggestions or has any experience of tackling large credit card balances and bringing them right down?
Thanks in advance.

@SnowdropEirlys well done on the progress! Just wondering generally what line of work you are in?

Presume the money in your pay has already had income tax deducted etc?

You are doing amazingly well. That new contract is good news, too. Keep going

I'm so glad you updated, I was thinking about this thread just yesterday. Absolutely brilliant progress. Now you're into the bit where quick wins are harder plus everything costing more. But you're in a much better position to deal with a squeeze/recession with less than half the debt you had previously.

I have an aim to pay for a big holiday next year without touching my credit card. Flights paid for, thinking about booking accommodation next.

Yes @Indigoo03 - it is short term contracting work, all paid via PAYE (umbrella).

Just stumbled across this in active threads and it's so satisfying for me seeing your balances come down, can't imagine how you must feel 🥳

@SnowdropEirlys excellent! Seems an excellent rate so wondering what field it is? IT ? Professional services?

Hi, I've not had time to read the full thread so sorry if I'm repeating previous advice. Firstly cut your costs as much as humanly possible....lots of resources online for tip and I'll stick a link to a good one at the end of this message. Secondly look for a new credit card with 0% on balance transfers otherwise all your hard work paying down the balances will be wasted paying unneccesary interest. Transfer as much as you're able to do to 0% cards. Transfer the ones with the highest interest first. Then put all your efforts into paying off those that can't be transferred as soon as possible. That's it really simple. Cut costs, avoid paying interest as much as possible, pay as much of as quickly as you can. Job done. Check out beamoneypro.com for saving tips ....good luck

beamoneypro.com/category/save-money/

Hi all,

I just wanted to come back on here to update the thread. As of today, my cards are all paid off. I can't quite believe it.

I've been in a massively fortunate position with my income and I don't take that lightly. I've stuck at the habit of just sending payments off as soon as the weekly pay would land in my bank account. I'm so used to doing that now, I'll carry on, but this time it will to save money, truly
save for the first time in my life.

It feels quite strange and will take some time to get used to that cloud no longer hanging over me. Thanks to everyone for their support in the early days of clearing that dreaded 11k Barclaycard!

Good luck to those who are still on their journey. Just stick at it. It is worth it.

Wow, this is amazing - from £20k of debt to £0! A huge well done, and hopefully now you can build up some savings 🙂. I'm so chuffed for you.

AMAZING!! I've thought of you a couple of times recently and wondered whether you would have managed to get down to £0 so a huge well done!!

What a relief you must feel, I hope you're going to give yourself at least a small treat for all your hard work .

Also have a look at MSE for which savings account may be best, now that interest rates are going up it's important to make the most of it and get as much interest as possible.

Well done, I paid off my DMP a couple of weeks ago and it really does feel amazing!

I'm so used to doing that now, I'll carry on, but this time it will to save money, truly
save for the first time in my life.

firstly well done, its a great xmas present

there are some really good regular savings accounts going - if you opened up one each week for 4 weeks - you can put your weekly amounts in each alternatively. Barclays, Lloyds are paying over 4%

If you can clear £20k of debt in 10 months....this time next year you could be sat on £20k plus the interest

Genuinely thank you. One of the most supportive threads on MN. I will look into the savings accounts.
Thanks so much, again.

You've done something amazing. Absolutely delighted to hear it. And I'll bet that you worked hard for that salary... but at least you are now completely free of that debt.

Do you have any savings goals? 6 months salary in savings for example?

Congratulations! That's an absolutely wonderful achievement - well done!

Would definitely recommend checking out the YNAB website and community for "next steps" - once I'd paid off my student overdraft I found them really helpful. Congrats again.

Congrats @SnowdropEirlys i also have thought occasionally about this thread. Well done for paying off your cards

Congratulations! An amazing achievement. Especially as it had been 10 years or so, dragging around the debt. Fantastic motivation and mindset for you to see your increased salary as a way to clear this up. Even if you go back to your normal salary now, you are still ahead, as you no longer have those big mimimum payments on each of the cards to make.

Huge congratulations again! And one final tip - cut up and close at least 3 of the cards, and (if you must keep one for emergencies) keep the limit on it low - say £1000. If you have savings/emergency fund, you won’t need the cards as an emergency, and you’ve seen how easy it is to run them up once…… Cut them up, close them and move on knowing you’ll never be in debt to the cards again :)

That's such brilliant news! Huge congratulations! You must feel such relief, especially as now any extra money can become savings.

Bloody well done! 👏👏👏👏