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Debating how to do this.

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by , 01-20-2009 at 11:39 AM (1091 Views)
I have a dumb debt on a a high interest cc. Dumb I know, I was under the impression it was lower.

If I go by balances, I'll end up paying nearly $3000 more in interest. However, if I pay it first, I'd save that $3000. It doesn't lengthen or shorten the amount time paid, we're looking at Feb/mar no matter which way. However, there's no instant gratification in paying things off fast.

I'm thinking i'm throwing all extra money at this one first. It'll take 7 months to get rid of it, and the balance of the snow ball pays off the next one the same month.

I'm really annoyed by the high interest, I did call to see if they'd lower the rate and they refused.

I have the option to also transfer part of that balance to lower interest. That would pay it off 3 months sooner, saving even more money.

I'm not sure what to do, I do think i should lower the rate if I can, if it means transferring then I will do that. It makes more sense, less interest to pay means more principal paid.

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Debt Reduction

Comments

  1. MyMelody's Avatar
    It really stinks that the CC people wouldn't lower the interest rate. I like your idea of transferring part of the balance to a lower interest rate and then throwing the snowball at it. T
  2. MyMelody's Avatar
    It really stinks that the CC people wouldn't lower the interest rate! I like your idea of transferring part of the balance to a lower interest rate and then throwing the snowball at it. Having to paying $ towards interest when you've still got principal sitting there unpaid is like spinning your wheels to me -- you may dig ruts, but you ain't travelin' nowhere! Good luck!
    Updated 01-20-2009 at 12:31 PM by MyMelody (Sorry for the double post -- couldn't figure out how to delete one!)
  3. Debbie-cat's Avatar
    I think also that it would be a good idea of transferring part of the balance. Keep snowballing it. Good luck!
  4. UUMomof3's Avatar
    Hey, modify the plan as you see fit and necessary. Transfering the balance makes good sense. Then paying it off as quickly as you can and closing the account. Well, that last bit if you are willing to take the possible hit on the credit rating...on one of our cards, the satisfaction will be worth it.

    If you don't want to close the account, sending them the card in pieces might feel pretty good.
  5. SheKat's Avatar
    This is what I would do. Transfer as much as you can to a lower rate. Pay of the higher rate first and then the next smaller rate. Keep a big graph where you can see it and mark down you payments so you can visualise the amount decreasing. Its not the same as that instant gratification but at least its something you can look at and watch your progress.