what should I do?

[frugal is fun]

for some reason I'm having a really hard time making this decision.

I have $2,000 in savings. I have $457 on a credit card (heating oil). This is the only debt I have except for my mortgage. However, I am going to be needing to add oil to my tank in probably 2-3 weeks and that will be another $500 plus.

I've been trying to pay the credit card balance with the overtime that I have been making but thats ending with this week's paycheck and it will only be about $30 that I can put towards the cc this week.

What would you do...would you widdle it down each week, or would you pay it off? keeping in mind that I have another $500 coming in a couple of weeks.

This is the first winter in my house so I wasn't prepared for the cost of oil. I have a "system" in place so next year I won't be charging my oil, I'll be able to pay cash.

[Greebo]

What would you do...would you widdle it down each week, or would you pay it off? keeping in mind that I have another $500 coming in a couple of weeks.

Pay it off. The longer you wait, the more expensive that oil gets.

[Josephhgoins]

what is your credit score like? Usually paying off a credit card actually effects your score negatively. How important is your score over the next few months or year?

Greebo is right, the oil is getting more and more expensive as the interest adds to it, but keeping your credit score in good shape may help decrease your interest rate on future debt.

is 2K the extent of your emergency fund?

[Greebo]

what is your credit score like? Usually paying off a credit card actually effects your score negatively. How important is your score over the next few months or year?

No, *closing* a card affects your score negatively. Paying it off improves your score because it improves your used/available credit ratio.

[2ndGenGranola]

I'd pay it off.

[NikoSan999]

I'd pay it off. Oil is expensive enough without adding to it. Oil companies are rich enough. Especially with needing it again so soon.

[Palooka]

Pay it off.

Peace of mind.

[Greebo]

I'd pay it off. Oil is expensive enough without adding to it. Oil companies are rich enough. Especially with needing it again so soon.

Strictly speaking, if the balance stays on the credit card, it's the banks that'll be getting richer.

Otherwise good point.

[mama2James]

I would have to say that whether or not to pay it off depends on how safe you would be with only $1550 in your emergency fund. How soon would you be able to replenish that? How to you plan to pay for the next oil purchase, e-fund or charging it. If I were you, I might keep the current balance on the credit card and plan to pay the next charge out of the e-fund to avoid further debt. Another option, if you felt safe doing so, would be to pay off the credit card and purchase the next oil both from the e-fund. That would leave you with only about 1K in your e-fund, but that might be enough for you. All depends on your comfort level. Sorry to ramble

[Trishagirl]

Pay it Off! Then you'll have no debts!!!!!

[frugal is fun]

thanks for the advice.

The $2,000 is the extent of my liquid cash. I do have a nice "nest" in mutual funds that is different than my retirement funds.

The next oil purchase is also going to go on the card but I can also pay that off like mamma2james said.

I do expect to get a pretty decent tax refund back considering I just bought my house this past summer and I can write off the interest. I plan on using some of that money to put towards next years oil fund and the rest to replenish my EF.

I am not comfortable with only $1,000 in liquid cash BUT if "something" happened, I do have the mutual funds to fall back on as a last resort.

[frugal is fun]

oh and a side note...I have excellent credit, low 800's when I applied for my mortgage last summer.

[Josephhgoins]

Greebo, believe it or not, paying a Credit card off in one large payment will negatively effect your credit score.

Keep in mind exactly what a credit score is used for. Its not used to save you money but rather help lending institutions make money.

[Palooka]

Greebo, believe it or not, paying a Credit card off in one large payment will negatively effect your credit score.

Keep in mind exactly what a credit score is used for. Its not used to save you money but rather help lending institutions make money.

Very true, however the more I paid mine off in a large lump sum, the more the creditors increased my limit far to much to be comfortable.

Also your credit history will still be on the up if it shows you paid off something.

[bumplett]

I'd like a ticket on the "pay it off" train.