Overdraft or Credit Card?

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DarkWhisperer

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My CC is sitting on R14k used. I have an overdraft facility which covers that amount easily. The 14k has been sitting in my CC for at least 60 days, so the "interest-free" period doesnt apply any more.

Will I save money (interest especially) if I pay the 14k using my overdraft? The math makes sense, since my overdraft interest rate is almost half that of my CC. But is there anything else that the banks have cooked up that I have to be aware off?
 
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DarkWhisperer said:
My CC is sitting on R14k used. I have an overdraft facility which covers that amount easily. The 14k has been sitting in my CC for at least 60 days, so the "interest-free" period doesnt apply any more.

Will I save money (interest especially) if I pay the 14k using my overdraft? The math makes sense, since my overdraft interest rate is almost half that of my CC. But is there anything else that the banks have cooked up that I have to be aware off?
Click to expand...

Their may be a "journal fee" on your overdraft.
 
it really depends on the interest rate on each account - you should check your statements, they usually tell you there. CC companies and banks have different interest rates per card/account type etc

Edit: my bad ... didn't read proper :)
 
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Also, my broker told me that if you can't pay your overdraft they can come and take your stuff, whereas with a CC you just get a bad credit rating and letters...
 
R14k in the red?? Get that paid off man! Don't juggle debt- a CC in the black will tempt you to use it again.

Ease up the spending, no more unecessary expenses until it's paid up.
 
Budza said:
R14k in the red?? Get that paid off man! Don't juggle debt- a CC in the black will tempt you to use it again.

Ease up the spending, no more unecessary expenses until it's paid up.
Click to expand...

+1
 
The overdraft's interest rate is a lot less than the credit card's interest rate.

The "journal" fee I pay anyway (something like R20 just for having the facility). So I emptied my savings and went into my overdraft, paid off my credit card and petrol card and applied for a petrol card linked to my cheque account.

Saves a **** load in interest payments each month and I can monitor my money easier this way. Now only thing I have is a few thousand in the overdraft and my car payments.

Hopefully this time next year my car is also paid off in full.
 
being in the industry i would suggest that you clear the cc as a.s.a.p. Is this 14k straight? or is some of that on your budget facility?
 
Why get a petrol card when you can pay with your credit card now?
 
czc said:
Why get a petrol card when you can pay with your credit card now?
Click to expand...

You can't pay with your credit card, only debit cards. Credit and Cheque cards are still not accepted. I'd have a Garage (or Petrol) card so I know I can make motor-based purchases with it without exposing my credit card or cheque card to fraudsters working at petrol stations that might try to clone the information on there.

I'm paranoid, but still...
 
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