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Should I pay off my debt with my savings? Also: surgery?

PostPosted: Thu Oct 28, 2010 6:48 am
by HM_London
I'm 28, live in London and have £17k of savings in an ISA, obviously not earning much interest these days (about £7/month).
I have about £9.5k of credit card debt which I transfer from one interest-free card to another. I'm not a profligate spender - the debt is from a small business I bought a few years ago, which is currently not making much money. (A friend is running it)
I pay off the minimum only every month as I had a badly paid job and have now gone back to university to study an MA. I currently have an income of about £250-300/month from a lodger which has to cover bills (for the whole house) and living expenses. I don't own the house but have discounted rent from a relative who owns it. Obviously I cannot carry on living like this and will need to use my savings and/or get a part-time job to fit around my studies (easier said than done!)

I haven't paid off my debt as I thought since it was interest-free, why not pay the minimum whilst keeping my savings, I guess I was hoping to keep that money to one side and somehow pay off the debt gradually with earnings. I can see that isn't going to happen for a while now that I'm not working. I was saving to start a business in the future - though I don't have any concrete ideas at the moment, but ultimately this is what I want to do and feel that using my savings now will put me back to square 1.

The other thing is that I really want a nose job which costs £5,500 (I know there are cheaper ones but this is secondary surgery so more expensive and I want to go to the same palce as before) - I was of course putting this off until I can justify the expense but now I'm thinking I should just spend the money as the longer I put it off, the longer I have a nose I am not happy with, and these are the years I especially should be having fun, meeting people etc.

So, I'd really appreciate people's opinions on whether I should use the money for the debt and/or surgery - this would take my savings from £17k to about £2k, which I can live off until finishing my studies (along with the £300/month). I'm not a big spender as you can see!