Help me with my math please!

[frugalredhead]

I have been working on this and now have myself so confused.

We have $5400 to put towards one of our credit cards. We can do 2 things:

1. My husband can put it towards one of his cards, interest rate about 11%, I think. He's only paying minimums otherwise.

2. We can put it towards my Discover which is at 13.99%, and then I can transfer $5400 of his CC balance to my Discover (I have offers for 0% for 12 months with a 3% transfer fee, or 5.99% for 18 months with no transfer fee). Rate after promo period is up would be 11.99%

Psychologically, he's having a hard time with my balances going down while his stay more or less the same (even thought he know it is because we ar going in order on interest rate and his aren't the highest).

Mathematically, which makes the most sense. Thanks for the help, my head is spinning!

[bjl584]

The first thing to ask is can you pay off the $5400 before the 0% interest rate expires?

[TBH]

I think because you have a transfer fee on yours, and because you have a 0% balance transfer situation, I would just put the money towards his cards.

[Petunia 100]

You aren't talking about a great deal of money either way, so I think I would make the decision that my spouse and I both felt was fair.

How much does he owe on his two cards?

Is his budget tight? You mentioned on your blog he pays for certain things and you pay for certain things. If he doesn't have much wiggle room, he may be hoping for the budget relief of one less obligation to juggle.

[humandraydel]

The mathematical difference is not worth it - just split the payment between the 2.

[frugalredhead]

You aren't talking about a great deal of money either way, so I think I would make the decision that my spouse and I both felt was fair.

How much does he owe on his two cards?

Is his budget tight? You mentioned on your blog he pays for certain things and you pay for certain things. If he doesn't have much wiggle room, he may be hoping for the budget relief of one less obligation to juggle.

Thanks everyone! Yes his budget is tight, he owes $18K on his 2 cards. I can't honestly say I know what his budget looks like, but the majority of his payments are set amounts (mortgage, car payments, etc). He buys groceries here and there, and pays for his gas, but he has a very short commute so that's not much. I do most of the grocery shopping and then pay every extra penny towards the credit cards, so if I have a month with an unexpected expense, I can still make my payments, it's just less extra towards paying off the debt.

No, we can absolutely not pay it off before the 0% expires. But it is not one of those offers where you have to pay the interest retroactively, so it's still 12 or 18 months where you're not paying interest, whereas we would if we didn't make the transfer.

I think I'll feel him out about giving me $2K for paying off my Chase card so I can get going on my Discover, the bulk of which is at 13.99% (my highest). I am eager to get that paid off at that interest rate!

[disneysteve]

I'm confused by the the "his" and "hers" debt issue. I would suggest sitting down together and reviewing the household budget. List all income. List all debts with interest rates. If there is excess household income, apply it to the debt with the highest interest rate regardless of whose name it is in. Consider everything to be joint and you eliminate the issue.

[frugalredhead]

I'm confused by the the "his" and "hers" debt issue. I would suggest sitting down together and reviewing the household budget. List all income. List all debts with interest rates. If there is excess household income, apply it to the debt with the highest interest rate regardless of whose name it is in. Consider everything to be joint and you eliminate the issue.

We are more or less doing that - 3 of my cards have higher interest rates than the 2 in his name, and I am the one with the extra income, so it works to just keep it like this for now. We did just talk about it, and my hope is that as I get some of my cards paid off, I can transfer his balances to my cards and give him some of the other fixed cost bills that I currently pay instead.

The reason we have our finances the way we do is that we moved in together before we were married, and lived that way for a few years, so i's just been easy for us to keep it that way! I definitely see us changing things as we get this debt paid off... maybe by our 15th anniversary we'll open a joint checking account

[jIM_Ohio]

The mathematical difference is not worth it - just split the payment between the 2.

+1

Keeping people happy is more important than saving $1000 (or less)

[molly1]

I think you have to sit with your hudband and calucate all budget after that decide all other things.