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get out of debt (read all 26 entries…)
More on credit cards 15 months ago

I started out (when I started this goal) with multiple cards and school loans and no end in sight. The end still isn’t really in sight, but I’m starting to see a light at the end of the tunnel, so to speak.

I paid off one of the cards this month, and I’m set to pay off another one next month. My best friend, who’s holding all my cards and helping me not spend more money (!!!) is cutting up those two cards. A third card’s account (that was already paid off) was closed by the credit card company, so that one’s completely done and gone.

That leaves me with the following:
—Chase Rewards: paid off and closed. don’t know where the card is anymore, but I’m pretty sure it was cut up years ago.
—Chase Disney: paid off this month. friend is cutting it up for me.
—Orchard Bank: paid off next month. friend is cutting it up for me.

—HRC Visa: cut up the actual card a long time ago and am now just paying off the balance. current balance is $4300. I’ll know the APR with the next bill.

—WaMu Platinum: the only credit card I still have in my possession; supposed to be for emergencies only, but tends to be for dinner and other stuff, too. I’m trying to cut back on that. current balance is a little under $1500. I’ll know the APR with the next bill.

—Capital One: friend has this card. current balance is roughly $1900. APR for purchases is 5.65% and for cash advances is 16.55%.

—Bank of America: friend has this card. current balance is just under $4100. APR is 7.9% for purchases and transfers and 24.99% for cash advances.

So my total credit card debt is $11800. Less than I thought, but more than is acceptable. I would like to get it below $10000 soon and then work from there. Paying off credit cards helps, but it would help more if I don’t buy anything on credit ever again, unless it’s absolutely necessary and I can pay off the balance within a couple of months. Also, I would like to get down to having only one card.

So, that in mind: here’s my dilemma. Should I pay just over the minimum balances on all but one card at a time so that I can pay off that one faster, or should I be more balanced in my payments?

Sep 05, 2008, 11:14AM PDT | 1 cheer


Comments:

Michael Wilson

Pay debt faster

In our business, we work with people that share your goal of getting out of debt.
It sounds like you are doing the right things, trying to be disciplined, and focusing on the goal.

Recommend focusing on one card at a time, like you suggested, and keep paying others at minimum (at least).

Strategic payoff is one of strategies that we use in our program and it is a critical one.

The challenge is always in the complexity – which debt first? how much to other debts? etc.

Good Luck.

Contact me if you want help.

Michael Wilson
www.SmartMoneyForLife.com

Sep 05, 2008, 12:17PM PDT | Respond to this

devonrex_cat

I’m not really sure what you’re asking? I think you’re asking whether you should focus on one card or spread the payments around. I’m not an expert, but for what it’s worth (?), I would pay minimum balances on all if you can, and then focus any extra on where you are accumulating the most interest. So, direct the extra towards the card with the hightest rate. Because that money owing is the most expensive, dollar for dollar. Maybe? And devote as much as you possibly can, because for every day those balances are there, you are paying for their existence (in interest).

Sep 05, 2008, 01:56PM PDT | Respond to this

plumcheeks (Sara) Poppy, my furbaby is my spazo of joy

another option

Attack the debt with the lowest amount owed and pay the minimum on the rest. When that one is paid off, go to the next one with the lowest amount owed and attack it. You’ll see results quicker that way and it can keep you motivated.

Do you always have your “emergency” credit card with you wherever you go? It sounds like you do if you’re using it for dinners. If it’s easily accessible and you can’t stop using it, maybe you need to give that one to your friend too.

Good luck!

Sep 06, 2008, 08:14AM PDT | Respond to this

lpkitten

i definitely recommend paying the card with the highest interest rate as you’re paying the most interest on that one. minimizing the amount of interest you pay ao you can focus on paying down the principal will get you out of debt fastest, as long as you are dedicated and focused. Good luck!

Sep 06, 2008, 12:50PM PDT | Respond to this


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