Credit Card Help

[Domain]

Master Card = $1770.30 @ 10.24%
AMEX = $2706.70 @ 13.24%
Personal Loan = $2383.96 @ 3%
Citi Card (close)= $11,000.00 @ 9.99%

Right now I am paying $250.00 towards the Master card and hopefully I will be done with it in 7 months. Everything else I am only paying the minimum. I should be receiving about $10,000 in the summer and I want to use that to pay off the Citi card. I will also be getting about a $300 raise this summer and I want to put it towards the personal loan. My plan is to put whatever money I was paying towards a card towards the AMEX since that will be the last one. After, I'm done with all the cards, build up an EF then invest. But before I get anywhere I need to pay off these cards. Can someone tell me if this plan is a good one? If not please offer some suggestions.

[jpg7n16]

Master Card = $1770.30 @ 10.24%
AMEX = $2706.70 @ 13.24%
Personal Loan = $2383.96 @ 3%
Citi Card (close)= $11,000.00 @ 9.99%

Right now I am paying $250.00 towards the Master card and hopefully I will be done with it in 7 months. Everything else I am only paying the minimum. I should be receiving about $10,000 in the summer and I want to use that to pay off the Citi card. I will also be getting about a $300 raise this summer and I want to put it towards the personal loan. My plan is to put whatever money I was paying towards a card towards the AMEX since that will be the last one. After, I'm done with all the cards, build up an EF then invest. But before I get anywhere I need to pay off these cards. Can someone tell me if this plan is a good one? If not please offer some suggestions.

Right off the bat, I see that you have (or had) a problem taking too much debt. This leads me to believe the best method for you would be paying off your debts from lowest balance to highest.

But I'm really interest rate sensitive. I just can't tell you to pay off that 3% loan 2nd. I just can't do it! sorry

So when you get your $10k in (hopefully tax free) - but if not, 1st pay taxes, then I would pay off the AMEX, then the mastercard, then whatever remains goes towards the Citi card.


Then go back to paying the minimum on the Citi card, and pay off the personal loan. Once it's gone, add that payment to your Citi card payment.



I really don't understand why you wanted to keep the highest interest rate card (AMEX) around the longest. It should be one of the 1st to go.

But then you are exactly right:

After, I'm done with all the cards, build up an EF then invest.

And preferably invest in some type of retirement account (401k, Roth IRA, etc.)

[maat55]

I would apply the 250 towards the AMEX first. Once the 10k comes in, I would payoff mastercard, put 1k in EF and use the rest towards citi. I would finish citi, then move to the personal note.

[Domain]

Thx

Thanks. I will consider both and let you know what I come up with.

[Domain]

So when you get your $10k in (hopefully tax free) - but if not, 1st pay taxes, then I would pay off the AMEX, then the mastercard, then whatever remains goes towards the Citi card.

The 10k is going to be tax free. The concern that I have with the above is that right now I'm paying $250 towards citi. If I pay off citi that would free that $250 to put towards another card. Paying off the biggest debt would make more sense to me.

Then go back to paying the minimum on the Citi card, and pay off the personal loan. Once it's gone, add that payment to your Citi card payment.

I really don't understand why you wanted to keep the highest interest rate card (AMEX) around the longest. It should be one of the 1st to go.

I don't know why either. Thanks for pointing that out to me.

For now, I will change my game plan and start paying down AMEX. Right now I pay $250 towards Mastercard. I will pay the mini on that and put the $250 towards AMEX. Which would make the total payment towards AMEX about $300 a month because the mini on AMEX is $50.

[bjl584]

Master Card = $1770.30 @ 10.24%
AMEX = $2706.70 @ 13.24%
Personal Loan = $2383.96 @ 3%
Citi Card (close)= $11,000.00 @ 9.99%

Right now I am paying $250.00 towards the Master card and hopefully I will be done with it in 7 months. Everything else I am only paying the minimum. I should be receiving about $10,000 in the summer and I want to use that to pay off the Citi card. I will also be getting about a $300 raise this summer and I want to put it towards the personal loan. My plan is to put whatever money I was paying towards a card towards the AMEX since that will be the last one. After, I'm done with all the cards, build up an EF then invest. But before I get anywhere I need to pay off these cards. Can someone tell me if this plan is a good one? If not please offer some suggestions.

There's a few ways to approach this. You could pay off all of the Mastercard, the AMEX, and the personal loan when you get the 10K this summer. Then put the remaining toward the Citi card leaving you with roughly 7500 or so on the card. Then you could shop around for a 0% card to transfer the balance to.

Or, you could go lowest balance to highest.

Or, you could go highest interest rate to lowest.

[Domain]

I have about 6/7 months until June can I get some ideas on what to do right now. I do like the idea of paying down AMEX because it's the highest %.

[jpg7n16]

The 10k is going to be tax free. The concern that I have with the above is that right now I'm paying $250 towards citi. If I pay off citi that would free that $250 to put towards another card. Paying off the biggest debt would make more sense to me.

Then go back to paying the minimum on the Citi card, and pay off the personal loan. Once it's gone, add that payment to your Citi card payment.

I get why it would seem that way, but you could also say that if you paid off all the other debt- you could add all their payments to the Citi card to really start taking out serious chunks. it's all in how you look at it

I'd hope you're trying to pay $500+ each month to get rid of all these. The more you pay, the faster these go away.

I don't know why either. Thanks for pointing that out to me.

For now, I will change my game plan and start paying down AMEX. Right now I pay $250 towards Mastercard. I will pay the mini on that and put the $250 towards AMEX. Which would make the total payment towards AMEX about $300 a month because the mini on AMEX is $50.

I like this change if you can stick with it. Then with the $10k, just clear out as much interest as you can! You'll be well on your way

[littleroc02us]

What's your plan for emergencies?

[Domain]

I have about $600 in my EF right now.

[JamesHill]

Are you familiar with the Debt Snowball method?

[Domain]

yes i am.

[Radiance]

I got myself out of a similar situation.
I have to admit I did lower balance first.
At the same time I cut expenses to ensure I never needed to use them again!

[littleroc02us]

I have about $600 in my EF right now.

I think you should bump up the EF to $1000 before moving on. Once done, just list your debts in order from smallest to largest not taking into account interest rates.. Work you butt off to pay them off one at a time. What you'll find out is that once the littlest one is gone, you'll have more money to work with to conquer the next. Good luck!

[hard2figure]

I would have to say that I would go with the Master Card first ... mainly because it can be paid off sooner and be added to your "snowball". And think of it this way, if the $10,000 doesn't come this summer you can still feel good about having paid something off. Then the AMEX (not sure if it will be the next lowest balance come summer but the difference in interest is petty big).

And if your $10k does come, you will have already paid off the MasterCard yourself. And can then kill off the AMEX too, then I'll agree that I'd have to think again about knocking off the personal loan (don't know the min. payment) versus all toward the Citi Card. Either way keep the snowball rolling down hill and don't charge things back up.