Potts of gold

Mobile phone salesman Paul Potts had 30,000 reasons for winning Britain’s Got Talent – that was the massive debt the opera singer was facing before winning through.

Now the 36 year old from Port Talbot has a £100,000 prize and a date to sing in front of the Queen he can dramatically change his tune on debt. He’s set to launch a career as an opera singing star and shouldn’t need to worry about cash again.

Paul, who stunned judges Simon Cowell, Amanda Holden and Piers Morgan to win Britain’s biggest ever talent contest, won’t have to juggle credit card debts any more.

However his story of a nightmare descent into debt hell after taking out too many credit cards just to pay his way following a horrific run of health problems is all too common. And unfortunately not everyone will have the happy ending of winning a £100,000 prize

Poor Paul ran up £30,000 in debts when he couldn’t work. But what if he hadn’t won? He’d still have the £30,000 debts to deal with. And if he isn’t on any special deals he could be paying as much as £4,800 a year in interest alone, according to MoneyExpert.com.

If you’re in a similar situation to Paul Potts, read on for ways to deal with debt before it’s too late.

MoneyExpert’s ways to deal with credit card debt:

1. Don’t pay more than you have to. Check your credit cards to make sure you’re on a zero per cent deal or a ‘low rate for life’ arrangement. Check the tables below to see what the best deals are – you’ll be paying as much as 16% interest if you don’t sign up.

0% Balance Transfer Credit Cards

Provider/Product Balance transfer period/Intro Rate Fee Typical APR (Variable)
Barclaycard Platinum Visa 13 mnths/0% 3% 14.9%
Virgin Money Mastercard 13 mnths/0% 2.98% 15.9%
Halifax One Mastercard 12 months/0% 3% 15.9%
MBNA Europe Platinum Plus Visa 12 months/0% 3% 15.9%

Compare 0% balance transfer credit cards today

Life of Balance Credit Cards

Provider/Product BT intro rate/period Fee Typical APR (Variable)
Citibank Platinum Mastercard 5.8%/unlimited 2.5% 16.9%
Barclaycard platinum Visa 5.9%/unlimited 0% 14.9%
Leeds Building Society Mastercard 5.9%/unlimited 2% 17.9%
Liverpool & Victoria Visa 5.9%/unlimited 2% 16.7%

Compare life of balance credit cards now

2. Pay off your debt. Start a payment schedule to reduce your balance by more than just the minimum payment. It can take years to pay off a credit card just by paying the minimum, and you’ll end up paying huge amounts of interest that way. Paying off your debt is the best way to deal with it – so work out what you can afford, and stick to whatever you agree.

3. Consolidate your debts into one loan. If you’ve got debt in lots of different places or on lots of different cards, you’ll be paying different interest rates and will have different deadlines for repayments. This can cause chaos with your finances and might be more expensive than bringing all your debt under one roof with one loan. Rates on personal loans start at just over 6% so in the long run it can be a good option – you’ll also start paying off the debt, which is half the battle.

Personal Loans

Provider Typical APR
Moneyback Bank 6.2%
Alliance & Leicester 6.3%
yourpersonalloan.co.uk (homeowners only) 6.3%
Northern Rock 6.5%

Compare personal loans

Use MoneyExpert’s consolidation calculator to see how much you could save in monthly payments by consolidating your debt today!

4. Make sure you’re claiming all the benefits you are entitled to. And draw up a monthly budget so you can get your spending under control.

5. Join a talent contest! If you’ve got talent like Paul Potts, it’s the quickest way to a bumper cheque – but beware, Paul had to see off 50,000 hopefuls to win so don’t expect an easy ride!

Click through to MoneyExpert today for more money saving advice

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