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Original poster

Should I use savings to pay debt?

27 replies

flatwhite201839 · 20/09/2022 10:02

I have £2.5k saved, I have been putting money away since youngest DC was born, and hoped to take DC on holiday next summer hols (single parent, minimal financial support from DC father).

I had a few emergencies this year which I had to put on my credit card as I didn’t have the cash upfront - car broke down twice and had expensive garage work, and had to get a new fridge.

At the moment I’m paying back £100-200 monthly on the credit card amount (just under 2k) so it should be paid off in around 18 months, I pay off extra when I do overtime at work, and I’ve started a separate pot for emergency costs. But I’m wondering if it’s more sensible to use the bulk of my savings to pay it off, and scrap the holiday idea, although realistically it will take a few years to save up again?

my interest rate is very low on the CC.

OP posts:
Discovereads · 21/09/2022 16:08

Sisisisi · 20/09/2022 21:03

Yes I understand how mortgages work, however we were discussing unsecured debt which has occured as the result of annoying but fairly predictable expenses, fridges and cars break down.
In the Ops circumstances paying off the debt and creating a pot would get her out of the debt spiral THEN go on holiday.
Clearly we have different opinions
im financially secure and it never gets old!

But she’s not in a “debt spiral”. She has experienced a trio of set backs that have put her temporarily in debt. She is paying off the debt responsibly and saving on top of that. Too, whatever the debt is, it is no more than £2.5k which is tiny…it’s not massive debts to be in a panic over such that you need to sacrifice savings set aside that you’ve scrimped, per the OP for YEARS. So obviously, it will take YEARS to replace these savings. She’s not on £10k/mo where she can save that amount again by the end of this year.

And being a single mum with DC, there may not be a chance to be 100% debt free and then go on holiday. She could very well pay off this debt now, start saving all over again for the holiday and during the YEARS this takes whoops the car breaks down again, or she loses her job and is a few months unemployed, so then the holiday is put off yet again for more YEARS. Next thing you know your 8yo is 15yo…and there is no time left to save for a holiday.

I think in general it is unreasonable to tell any parent they shouldn’t even think about going on holiday unless they are 100% debt free.

Discovereads · 21/09/2022 16:19

JenJones5 · 20/09/2022 21:44

You need to remember that to some people, the worst thing that you can possibly do is to be accountable for your own actions, to save up rather than to take on debt, and to understand that you are in charge of your own destiny.

Doing this completely destroys their narrative that we are being held down by “the man.”

To use a common phrase, it does my head in how some people on here can’t bear to see anyone from a “normal” background work their way into a comfortable life by dint of planning, deferred gratification and gaining valuable skills.

Show quote history

Bollocks. No one is in charge of their destiny.
Narratives like this whitewash out the role of luck in all our lives- from birth onwards.
It makes being in debt a moral failure, rather than a tool to use to bridge over the worse times between the better times.
OP does plan and save up. She’s not an instant gratification junkie like youre insinuating she is, or are you insinuating I am like that?
She also probably works just as hard as you do.

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