How to pay off more than one credit card?

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anonymous user
Registered: 12-31-1969
How to pay off more than one credit card?
3
Fri, 08-17-2012 - 11:32am

I have two credit cards to pay off, and I'm wondering if it's better to pay them off separately, or combine them? I think it would be easier to have just one payment, but if I put the amount from one onto the other, won't I be paying the interest twice on that one?

iVillage Member
Registered: 03-17-2003
Tue, 08-21-2012 - 12:28pm

Hi wwwendy.

It sounds like you could benefit from a plan to tackle the credit card debt and one method is a snowball debt calculator. There are several free ones on line.  Snowball debt calculators function quite simply: each account you owe is entered as an item and once all of the debt is entered the calculator sets up a monthly spending plan to pay off the debt as cheaply and quickly as possible.  Each month you know how much to pay on each account.  Aside from paying off the debt as cheaply as possible it gives you a plan to follow that puts you squarely in charge of the debt both emotionally and financially.  The feeling of control is huge.

If you are considering a balance transfer offer you may find that the offer has an online calculator that helps you determine if it makes sense.  For some situations it may actually cost more money to combine debt via balance transfers than it would to keep the debt separate.

Hope this helps.

Carolyn

iVillage Member
Registered: 05-08-2006
Fri, 08-17-2012 - 3:47pm

What is the interest rate on each card, and what are the balances?  If the higher balance is on the higher interest card, and the fee to move it isn't high, it makes sense to move it to lower the interest rate.

If the interest rates are similar, then it doesn't make sense to move the balance.  But it might make sense to call the credit card company and ask if they can offer you a lower rate - don't ask like they are doing you a favor - ask because you are a valuable customer and you deserve it....

When you get to the lowest interest rate possible, if you still have two cards, pay off the balance on the higher interest rate one first, putting as much extra on it as you can, and pay the minimum on the smaller inteest rate one...that will save you the most money in the long run....