I need advice with paying off my credit cards.?

Question

I owe 5800 at 8.9%, I owe 4000 at 15.99% and I owe 800 at 14.9% I have some extra money, should I pay off the lower one first then move up? Or Start at the highest interest rate? Or should I start at the highest balance? I need help. Serious answer only please! Thanks in advance!

Answer 1

I recently show an Oprah re-run on paying off debt and I heard the financial analyst say that you should pay off the lowest debt first, no matter the interest. I think this is a smart idea because once you pay off the lowest debt, you can pretned like you are still paying off that debt and add that minimum payment to your other credit cards and get them paid off easier.

Answer 2

You should Pay the higher rate first, so start from $4000, bring that down a bit then go to 800 and pay that as fast as you can, so try to pay the last to Credit Cards at 15.99% and 14.9%..and leave the $5800 until you have paid the other 2 and dont spend anymore that you cannot afford. OR get a credit card at 0.0% and pay of the credit cards Amount that is at the high rated on that Credit Card which you got at 0.0% and you will be fine!!

Answer 3

I agree with first responder. If you can't pay everything off at once, make at least minimum payments on all, and pay off the highest interest rate first. Once all are paid off, make it a habit to pay off every balance in full every month. Although 8.9% is not an outrageous rate by today's standards, the others are ruinous. Once your balances are paid down, you may get offers of credit at rates of 2% or less; I take advantage of these. The hook is that only the balance transfer sum accrues cheap interest; any subsequent charges to the account are at a higher rate, and when you make payments, the payment is credited to the lower rate amount(s) first. So, if you use such a thing, you must not use the account for any other purpose until the cheap money is paid off.

Answer 4

Paying off debts like this is about 80% behavior modification and 20% mathematics. The math will work better if you start with the highest interest rate and pay the minimum payments on the others, but starting with the lowest balance will give you a "quicker win" and will give you the positive experience to continue with the next one.

For more information about this concept check out www.daveramsey.com. Look under Useful Tools and click on 7 Baby Steps. He talks about this in Baby Step 2.

Good luck!

Answer 5

Pay off the highest interest rate first. There's a big difference between 8.9% and 15.99%. If you have more room left on the 8.9% card try to consolidate everything to that one card, but be sure to watch out for transacation fees and such if you choose to do so (read the fine print first). Good Luck.

Answer 6

Always start with the highest interest rate. If the lowest interest rate card increases your credit limit, immediately transfer over as much of the balances as possible from the higher credit cards. If you find yourself spending again (example: You bring the balance of $4,000 down to $3,000 and now you find yourself spending that $1,000 you have worked so hard to pay off. May I suggest that you tell the credit card company to decrease your credit limit with each payment you make. So when you pay off $100 tell them after processing your payment to also adjust your credit limit to $3,900). It may not be the best way to go but it will prevent you from staying at a standstill with your debts.

Answer 7

To get the most out of every penny you can pay, you have to pay off the debt with the highest interest rate first.

The only reason to depart from that is if you need the psychological boost you would get from paying off a card entirely and having one less debt. Then put your money towards the one with the lowest balance. Pay it off and cut up the card.

Answer 8

even with each and each of the classified ads, maximum mastercard organizations gained't comply with a freelance except you've some severe situations. in case you do get a freelance, the cardboard corporation will document it as a charge off/settled -- a severe unfavorable. also receive a 1099 for the forgiven portion of the debt that would must be blanketed on your earnings tax go back. Plan on paying off the playing cards in finished. Paying off the smallest balances provide you with more suitable constructive money bypass yet you should apply that freed up money to pay on the only excellent playing cards. in truth, that's smarter to pay off the utmost pastime price playing cards first. You pay a lot less pastime and would pay off the playing cards swifter -- more suitable bang on your dollar.

Answer 9

You should pay the highest interest rate off first. So, apply extra money to the card with the highest int. rate every month, once that card is paid off then you take the amount of money you were putting towards that and apply it to the next highest int. rate card.

If you are looking to consolidate your cards there is a new concept out for loans, people to people lending. I am a group leader for borrowers. You can learn more here: https://www.prosper.com/public/groups/group_home.aspx?group_short_name=ImProveYourself

Answer 10

The amount with the highest interest rate should be pay off first the result of paying late will be in the increase interest rate and the amount due will increase after every month. But try using this formula: amount due=principals(amount borrow) X interest X Time( the extended month you have to pay it off.