I have already been making tremendous strides in paying down some CC debt. I've gotten it down to 2 cc balances and I'm just not sure which I should be focusing on paying off first.
AMEX (My husband's) balance is $4200 at18.99% with a minimum of $95 per month
Discover (Mine) balance is $18000 at 23.99% with a minimum of $388 per month
I have an additional $750-1000 each month to throw at these, some months payment more.
I know Dave Ramsey would say to pay off the small one, but the larger interest rate on the big balance is making to question that. Thoughts?
Personally I would pay off the smaller one because you could have that done in four months or less. Then every extra $ including the $95 payment on the AMEX would go to the larger one. It would also give me a sense of accomplishment and motivate me to really tackle the last one instead of continuing to have two accounts for 18+ months.
Can you do a balance transfer to a 0% card? That absolutely would be my first plan of attack.
Dave Ramsey says that b/c of the mental boost you get in seeing a loan paid off and b/c he believes that motivates you to keep going. You already sound motivated, so I personally would pay the higher rate card; assuming I couldn't do a balance transfer, that is.
It's easy to get into debt and so tedious to get out. It sounds like you've made a lot of progress. Congrats on that.
Can you do a balance transfer to a 0% card? That absolutely would be my first plan of attack.
Dave Ramsey says that b/c of the mental boost you get in seeing a loan paid off and b/c he believes that motivates you to keep going. You already sound motivated, so I personally would pay the higher rate card; assuming I couldn't do a balance transfer, that is.
It's easy to get into debt and so tedious to get out. It sounds like you've made a lot of progress. Congrats on that.
Can you do a balance transfer to a 0% card? That absolutely would be my first plan of attack.
Dave Ramsey says that b/c of the mental boost you get in seeing a loan paid off and b/c he believes that motivates you to keep going. You already sound motivated, so I personally would pay the higher rate card; assuming I couldn't do a balance transfer, that is.
It's easy to get into debt and so tedious to get out. It sounds like you've made a lot of progress. Congrats on that.
This is what we did last year. We found a 0% card for 1 year, transferred the max ($5000), then budgeted the amount per month to pay off. I would do that with the lower card, if possible. We went with Discover but we hadn’t had that before.
I would probably split the extra - maybe more to the smaller one to get rid of it. If you have $1,000 extra I’d do something like $250 (+388 min) to the discover and then $750 (+95 min) to the Amex. Once that is paid off in 4-5 months obviously push it all to the discover.
I would just work on knocking out that smaller one. I doesn't seem like it would take very long at all, and then you go at that last one. Focusing on the large balance one looks like it will save you a just a couple hundred bucks in the long run. Which is pretty negligible with the balances and interest you are already paying.
Good luck! Becoming debt free is an amazing feeling!
I prefer the avalanche method over snowballing. I’d prioritize yours with the higher interest rate because the larger balance could be impacting your credit score more and you’ll save more on interest in the long run. I’d still pay at least double the minimum on his so you are making a dent in it, and it will still likely be paid off first. Maybe you both have cards on both accounts and it matters less, but I don’t like the idea of one person carrying all the debt in their name if it was accrued for joint things. Also, call the credit card companies and see if they’ll lower the interest rates for you.
For the 0% balance transfer you can sign up for a new card, but that may leave you with 2-3 cards to pay on (and leave 0% until last or the promotional period is expiring). Keep the accounts but cut up or freeze the cards in an ice block if you don’t want to be tempted to use them.