Interest free credit or use savings for new sofa?

[gaggiagirl]

Need a new sofa. My last sofa cost around 2k and has lasted us 12 years.
I have the money to buy a new one in my account. If I use it for a sofa then I have very little 'rainy day' money.

If I get the interest free credit I'm saddled with another bill for 4 years.

Can somebody wiser than me please advise?

DFS offer 1 year no payments, then 3 years interest free.
On £2k sofa, this is about £50 interest at 1% and you can probably get better rates.
So you have less/no savings and have lost out on a good night out.

I'm not sure I see the point being made about unexpected bills. If you can't afford to keep money for unexpected bills AND buy a sofa then maybe you should save up a bit rather than taking on a debt.

Reality out of curiosity, what is the reason that you are so dead against taking on debt? If there is no issue with making the repayments and the money could be accruing interest there are definitely benefits to be had (albeit not massive ones in the current climate). It's also, as one PP said, actually quite detrimental to your credit rating to avoid absolutely all debt. Just wondering why you think it's best to avoid at all costs.

Always 4 years interest free. Can't see the point of paying upfront if it costs the same to spread the cost

what is the reason that you are so dead against taking on debt? never said I was dead against taking on debt I said I would rather pay outright than take on a 2k debt for a sofa - not against debt in the slightest, just unnecessary debts that I would not take on.

No such thing as a high interest savings account nowadays Which is why I said higher - small difference, very small, sadly

Had a quick look at MSE - Nationwide are offering 5% interest on up to £2,500. So 5% on £2k over 4 years would be £2,431 (if I've got my maths right!) IMO £431 interest is worth getting into "debt" (a debt you have the money to pay off if necessary).

Had a quick look at MSE - Nationwide are offering 5% interest on up to £2,500. So 5% on £2k over 4 years would be £2,431 but it's only for the first 12 months. There are lots of terms and conditions to adhere to as well. It's not just as simple as that.

Yes I saw after I posted that it was just for 1 year. Ok so there might not be as much interest but the principle is the same.

UPDATE... It would seem that the decision has been made for me. DFS called this afternoon, the finance company turned me down. Presumably the payments over 6m were too high in comparison to my lowly maternity leave earnings.
They said a different finance company had approved it and did I want to go back through to sign for that one. It's a long way to go so I've decided to pay in full over the phone tomorrow. The universe must be trying to tell me something

simple answer is buy a second-hand sofa, loads around that are hardly used.

and yes, there is no NO WAY you can get interest about inflation which is already over 2% (and was before the brexit vote). Carney hates savers.

Of course you can get interest over 2% special in current accounts. I have up to 3% on some and a regular savings account that pays 5%, although they don't offer that now.

I was in a similar situation 2 years ago. I didn't want to use all my rainy day fund for a side but I also don't want to be paying a sofa for four years so I paid a bigger deposit and brought the payments down to two years

We did this when it came to pay for a kitchen. Had enough to pay outright and fully intended to but we're offered 0% finance so figured we'd be better off putting the lump sum off the mortgage and paying for the finance while it's 0%.

Agree it only works if you're disciplined....I'm not but DP is. If it was me on my own I'd have the finance and blown the lump sum but with him I'm more sensible. Technically it's debt but it'll save us around 1k in mortgage interest so was a no brainer really.

Personally I'd take the interest free credit and put the equivalent savings in premium bonds so I had the chance of winning a prize whilst the sofa is being paid off. Money could be withdrawn from the premium bonds to make the sofa payment if necessary

It doesn't even sound like you can afford a 2k sofa based on the comment about rainy day money and your current low income. If I were you, I'd get a sofa from Ikea for 300-400 pounds (and yes, they easily last for 12 y too).