Doing a budget... would you skin yourself to pay off debts in a year or pay as little as you can.

[mamadiva]

So yeah title says it all really.

On a relatively low income between myself and DP so don't have much cash to throw around IYKWIM.

We have approx £2400 of debt at the moment, I want to get rid of it ASAP and did a budget but it works out I have 2 options...

I could either totally skin us leaving us with £60 a month spare, which I know is just not enough for saving, spending, days out whatever but it would get the debts paid off by the end of next year.

Or I could pay as little as possible (none of it will build up interest) with it being paid at a reasonable rate and being able to live comfortably without having to scrimp although obviously could take an extra few months to pay.

What would you do?

I think I'd something in between - I mean imagine if you scrimped for just one year, in one year's time you'd have loads of extra money to spend as you like because of not having to pay off any debt.

If you are not going to be adding any interest then i would be looking to save a small emergency fund and then scrimp to get rid of it and if not used the emergency money then that can pay of a little quicker too at the end (or a treat!)

I would do neither.

I would do as flamingo suggests and go for the middle ground. Perhaps go for a two year or 18 month option instead, so that you are not totally stuffed if a big bill comes up (boiler/car/vet bill etc)

£200/month would clear it in a year. I think even we could do that, if we really had to, and we earn 2/3 of sweet FA.

It depends on how important it is to you to get rid of it asap. I think most financial advisers would tell you that if you can clear it quick, you should. Interest etc.

I would skin myself to pay it off in a year.
If you don't, in a year, you will wish you had

See the £200 a month is total scrimping for us, we earn £280 p/week including tax credits, but obviously still have to pay bills, shopping etc so somehow £200 seems an awful lot.

But the other option is £150 and have the little bit stashed away for emergencies or days out with DS which are rare but count as treats to us.

Going to do the £150 and get it cleared off in a fair amount of time but means still able to deal with some emergency cash.

Thanks

Oh yes and no interest because it's daft little things no cards or anything just catalogue (which is £200) but will be paid off by August, nursery owed £170, rent arrears and an old phone bill have spoke through with all the companies and obviously checked amounts so just trying to sort middle ground but is all fine hopefully