Gen Z student trying to get on housing ladder

[dwssr2]

My pound sign/entire keyboard is broken, so please assume all figures are GBP. I apologise for how brief this is. My keyboard is a pain in the ass.

The context is complex, but please offer me your thoughts on this plan. I’m looking for potential holes and also advice on where to store 8, 000.

I’m about to complete my undergrad. The career I’m going into requires an MA and PhD. Currently applying for an MA with a scholarship for tutition fees. I work full time and am able to sustain my living expenses.

Current debt:

3000 high interest credit card

2000 no interest overdraft

 

[k3v1n55]

@dwssr2 This is quite a complicated situation, you want to prioritise paying off that Credit Card, because the interest is continually building. You will start to lose your 0% overdraft after you finish your masters as you will transition to a graduate account - most banks will reduce the size of it over 1-2 years, so you need to factor in paying that off, so you do have more time for that.

You need to follow the flowchart beyond this point really, you should look at a LISA for a housing deposit for the bonus, but you need to keep an emergency fund, possibly a larger one because your pay is lower and could be more unstable.

I'm also wondering about your car, it's not unaffordable but as a student how much do you need it? Perhaps some more contextual information about where you live, your expenditure etc would be useful, especially given the level of debt?

 

[dwssr2]

@k3v1n55 Thanks for replying!

Agreed about the credit card. I’m making regular, large payments. Now that I’m working full time, I’m gradually reducing all debt, hopefully clearing it by the end of the year. In the worst case scenario, I use the MA lump sum to pay it off.

I work along side my degree in a relevant field, so I need to car to get to work as it’s not near any public transport links. Plus I leave for work at an ungodly hour for the commute.

My expenditure (rent, bills, food, car, credit card, entertainment) is covered from now until September via student loans and savings. I can’t access this money to pay the debt off straight away, because SL payments are staggered.

That means every penny of my wages are going toward debt reduction. My take home pay is to the tune of 1200, as I’m in an entry level position, but this should move to 1400 within 12 weeks.

Another user has suggested a LISA for the lump sum, but I don’t really know what they are or how they work. Could you suggest a site where I can find out more?

 

[liturgicalbaptistpuritan]

@dwssr2 You mentioned elsewhere you're paying off the overdraft - you should consider paying the bare minimum as it's interest free and using all the rest to pay off the credit card. You could save quite a few quid but doing so

 

[dwssr2]

@liturgicalbaptistpuritan An excellent point, thank you!