iNTeNSeBLue98
DIS Veteran
- Joined
- Jun 6, 2000
How would you go about it?
Would you pay off the lowest balance or the highest interest card first?
Would you pay off the lowest balance or the highest interest card first?
Have you tried consolidating your debt onto your lower interest rate cards. Department store and retail store cards can carry interest rates of 20-23%. Then you aren't spreading your payments around on minimum payments. Also when you only have one or two payments you are less likely to miss one.
Do you already have a bank issued credit card? Many of them allow you to transfer balances to a current account thus not opening more accounts. You don't have to open a consolidation loan, just move all your high interest debt to the lower interest card/account.I have thought about debt consolidation, but we took out a small loan in June to buy a hot water heater, range and make two repairs to the car. DH wanted to pay off his Snap On with lower interest, but we were hesitant on applying for another loan so soon - but in a quick calculation of all the CC debt, the small loan and the Snap On account we could save at least $100 a month depending on the term and the interest. I just completed the application through the credit union. Cross your fingers for us.
How would you go about it?
Would you pay off the lowest balance or the highest interest card first?
Highest interest first, though some feel the "need" to see a card disappear to SEE their progress so they'll go to the least amount and pay it off first even if interest rate is lower.
Personally it just repeats a pattern in my mind, Instant gratification rather than good sound fiscal responsibility.
Don't believe in buying what you cant afford or Over-buying whether that be cars or homes or vacation homes....I think thats why so many people are in trouble in the first place.
BEST of LUCK to you! It will be a great feeling to be debt free!!! I think its great that you have a plan of attack.
Don't you think that at times, people don't USE credit cards b/c they think they need that new whatever..
ALOT of times, people use them b/c they are forced into a situation where they must, or whatever bill doesn't get paid.
That's true. The debt could be from medical bills or some other unforeseen emergency. But that doesn't change the fact that the best way to repay them is highest rate to lowest. That will get you debt-free the fastest and at the lowest total cost.
Most of the stories we hear and read are due to a spending issue but I have read that the number one cause for personal bankruptcy is medical bills.It's annoying to me, that people think that those with cc debt are uncontrolable spending monsters.
don't underestimate your own negotiating ability's. Call the CC company yourself and negotiate interest rates.
Basically I am looking at lowest to highest. Because I know my payments on the lower interest cards will go farther then on the higher interest cards & I can knock them off earlier then the cc's with the higher debt on them.
That doesn't actually make sense. Paying more to the lower interest card causes you to pay more interest on the higher rate card. Your payment would "go farther" if you applied it to the higher interest rate debt first and would get you out of debt sooner and at a lower overall cost.