If you have outstanding debt on credit cards approx £7k, and you are about to come out of work, what do you think is the best thing to do? Pay off all the debt and have less around you to live on when you are out of work or just pay off the minimum amount and have more savings to live on until you find work?
In the long run it's much cheaper to use savings to pay off credit card debts rather than pay huge interest payments/charges. As long as you'd have enough left to afford food, heat and light I'd pay off the debts. And you can apply for contribution or income based JSA while you look for work. Using up any savings may belp you get income related benefits
Not my debts, asking for my friend who doesn't know what to do. Not sure which way to advise to be honest. I assume she wanted to keep some savings around her rather than pay off cards in full when working.
If it's 0% then if you can trust yourself to organise the finances I'd keep the £7k in a savings account and set up a standing order to pay off the minimum payment credit card balances each month followed by a final baloon payment. But if your savings would take you over the means tested benefit level then pay off the debt to reduce your savings
By paying off a sum by direct debit each month this will keep her credit rating in good standing -actually paying the debts off in full my have a negative impact on her credit rating ( strange but true)