Where should I apply the extra money?
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|Tue, 04-20-2010 - 2:03pm|
My soon to be ex-husband and I have a credit card with right under $4000.00 balance at 23.1% interest rate. I am currently paying only $110 per month right now as that is all I can afford, though we are going to court soon and due to his income, he will most likely have to pay me $100.00 per month for me to apply to the payments as well (we don't trust him to pay if we split the balance 50/50 - he's pretty bitter and it's only in my name).
We also have a vehicle in both our names that I am paying solely on and I will keep after the divorce, the current balance left on the loan is around $16K and I pay $422.00 per month with about 4.5 years left on the loan.
I am very good about budgeting and have successfully paid a number of debts off in the past year.
My question is, in about another 4-5 months I will have another small medical bill paid off (again, our child's bill that he refuses to take responsibility for half of and I'd rather just pay it then wait ANOTHER year for it to poss go to an attorney, it's already in collections) and I will most likely have around $300 extra per month to utilize.
My question is: do I pay extra each month with that amount on the Credit Card at 23.9% interest (balance of $4000) OR do I pay it toward the car payment at 13% interest (balance of $16K)?