2006-08-14 07:51:27 · 9 answers · asked by susan_112147 1 in Business & Finance ➔ Personal Finance
I wouldn't empty my checking account if I were you. Do you have any savings? Suppose something comes up - trust me something ALWAYS comes up. Put at least $3000 of that in savings if you can afford to right now.
If you've got most of your bills paid for this month, however, and reliable income, it wouldn't hurt to make a nice big payment on the card, maybe as high as $1000 or so this month and maybe another grand next month if things are still going well. THEN, call the credit card company and ask to have your interest rate reduced. It's really the interest that kills you.
If you've made your payments on time, you should be able to threaten them with transferring your balance to another card. If they refuse to cut your interest rate, follow through on your threat: Apply for card with an introductory 0% rate on balance transfers and transfer as much of the balance as you can from one card to the other. Be sure to pay this off before the introductory period expires!
If you make bigger-than-necessary payments every month, you'll have that debt paid off before you know it. Just remember, you need to keep at least a few thousand in either your checking or a savings account for an emergency!
2006-08-14 08:06:15 · answer #1 · answered by hquin_tset 3 · 1⤊ 0⤋
It depends on how stable your financial situation is - do you have a job? do you anticipate having this job for the next year? etc. If it is stable, then I would suggest setting aside one month of "emergency money." You can determine that by how much you would need to get through one month (ie., rent, bills, food, etc.) Put that in a savings account so you won't touch it. Another factor to consider is the interest rate on the card. If the rate is low, say an introductory 0 to 5 percent, I would suggest making large lump sum payments, like $1500, a month. However, if it's at a typical rate like 17 percent, then bump your payments up to $2500-$3000 a month (to provide you with that much more income padding should something unforeseen happen). Then your card will be paid off in 2-3 months and you won't have left yourself in a financial lurch.
2006-08-14 16:57:30 · answer #2 · answered by SAL 3 · 1⤊ 0⤋
Pay it off. If something unforeseen comes up you can always borrow against the card. In the meanwhile you should pay off the card monthly and put some money into reserve, for that possibility we just spoke of. Once you have a few thousand dollars in the savings account you can use some of it to invest.
2006-08-14 15:31:12 · answer #3 · answered by HH@20 2 · 0⤊ 0⤋
You should pay off the credit card, but not all at once because then you'd be cash poor and have to start using the card again. ;) Otherwise, unless your checking account pays greater interest than the credit card charges, it's a no brainer.
2006-08-14 14:56:04 · answer #4 · answered by misslabeled 7 · 1⤊ 0⤋
I would pay 6000 off and keep 1000, because you never know when you will need the extra money. Plus it will lower your monthly payment and still give you a chance to improve your credit score.
2006-08-14 14:57:44 · answer #5 · answered by littlebettycrocker 4 · 2⤊ 0⤋
Pay as much as you can afford towards the credit card.
2006-08-14 14:58:03 · answer #6 · answered by Anonymous · 2⤊ 0⤋
yes unless you like paying interest
2006-08-14 14:57:52 · answer #7 · answered by Daniel P 2 · 1⤊ 0⤋
Pay just half. You dont want exhaust your savings.
2006-08-14 14:58:33 · answer #8 · answered by bros.parker 3 · 0⤊ 1⤋
DEFINATLEY & PAY CASH FROM NOW ON
2006-08-14 14:57:32 · answer #9 · answered by Penney S 6 · 1⤊ 0⤋