How To Clear Your Summer Holiday Debt | will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by will always be from Be Scamsmart.

Derin Clark

Derin Clark

Online Reporter
Published: 13/08/2021

After a difficult 18 months many have been taking advantage of the easing of lockdown rules to enjoy the summer holidays. Family get-togethers, dinners out with friends and trips away can all have an impact on bank balances, which may have resulted in some having to borrow more on their credit cards or dip into their overdraft to fully enjoy their summer.

For those who have found themselves borrowing more than expected on credit cards or overdrafts, here are five ways to clear summer holiday debt.

If you’re struggling to repay debt it is important to seek help from a free debt advice charity such as Citizen’s Advice who will be able to provide advice and support on how to reduce and clear your debts.

Interest-free credit cards

Consumers who have run up credit card debt can look at transferring the debt to a 0% balance credit card. These cards offer an interest-free period on transferred debt that helps to make it easier for borrowers to repay the balance. The interest-free period can be lengthy on some cards, for example HSBC’s Balance Transfer Credit Card Visa has a 0% interest period of 29 months on balance transfers, which gives consumers over two years in which to clear their debt without having to pay interest.

When taking out a 0% balance credit card it is usually recommended that, if affordable, borrowers make payments sufficient to have the debt cleared within the interest-free period. Consumers considering using 0% balance credit card should be aware, however, that these cards often charge a fee when making balance transfers which should be factored into repayments when calculating how long it will take to clear the debt.

When considering whether to accept an application for a 0% balance transfer credit card, as well as the interest rate offered, lenders will usually factor in the applicant’s credit score. As such, it is usually a good idea to check your credit score before making an application – which you can do for free here.

Reduce outgoings

If the debt is small, it might be possible to clear the debt simply by reducing outgoings and redirecting the extra money released towards the debt. Cancelling unused subscriptions or switching to cheaper membership options, can help to painlessly reduce monthly outgoings. As well as this, consumers should regularly look at switching energy and insurance deals to see if they can get a cheaper option, especially if their current deal is ending.

Homeowners coming to the end of a fixed rate mortgage deal or who are already on their lender’s standard variable rate (SVR) should also consider locking into a new mortgage deal and might want to consider speaking to a mortgage broker to discuss what impact this will have on their mortgage repayments.

Switch current accounts

For those with an overdraft, it may be possible to switch to a current account charging a lower overdraft rate. Switching to a current account with a lower overdraft rate will help to make it cheaper to repay the debt, but consumers should note that only certain banks will allow customers to move an overdraft from their old account to the new one. Many banks, however, will require that customers close their overdraft when they close their old account while switching to a new account.

As a result, consumers looking to move their overdraft to a bank offering a cheaper overdraft rate should contact both their existing bank and the prospective new bank to ensure that the overdraft can be switched over or repaid when the new account is open.

Consolidate debts with a personal loan

For those with debts spread across a range of lenders, for example credit cards and overdrafts, consolidating debts with a personal loan may be a good option. Right now, interest rates on personal loans are competitively low, for example those looking to borrow £5,000 to be repaid over three years can get rates from as loan as 3.40% APR.

With personal loan rates so low at the moment, consolidating debts into one loan can reduce monthly repayments, as well as making the debt more manageable with just one repayment to make per month. Those considering consolidating their debts this way should, however, be careful to not fall further into debt while repaying their loan and only borrow what they need to repay their existing debts.

Before applying for a personal loan it may be worthwhile checking to see if you are eligible, which you can do using our free eligibility check.


Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time. Links to third parties on this page are paid for by the third party. You can find out more about the individual products by visiting their site. will receive a small payment if you use their services after you click through to their site. All information is subject to change without notice. Please check all terms before making any decisions. This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

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