What would you target next???

iVillage Member
Registered: 06-04-2004
What would you target next???
7
Tue, 01-25-2005 - 1:42pm

I am really trying to figure out what to do next. In the next couple of months I will have my MBNA credit card paid off, yeah!! And then I will only have my car note and a Bank One credit card. My car note is 5.9% interest with a current balance of $10,500, and the Bank One credit card has a current balance of $5595 at 0%. I am somewhat leaning toward paying off the credit card next just because it is unsecured debt and it is also the smaller debt amount of the two, but I'm unsure what to do next as it is also at 0% until 10/05. Any ideas on what I should focus on next? What would you do?? Thanks in advance for your advise!

~leanne, so excited to almost be done with MBNA!!

~leanne

deciding to be happy doesn't mean that everything is perfect, but that you had decided to look beyond the imp

iVillage Member
Registered: 12-05-2004
Tue, 01-25-2005 - 1:49pm

Congrats on getting your MBNA card paid off soon! I would target the car loan next since it has a higher interest rate. ;-D

Congrats again!

Pat

iVillage Member
Registered: 02-19-2004
Tue, 01-25-2005 - 1:56pm
What is your car payment, the minimum payment on the credit card and how much total do you have each month to put towards them? Also, what interest rate does the credit card jump to after 10/05?

Photobucket

iVillage Member
Registered: 06-04-2004
Tue, 01-25-2005 - 2:06pm

My car payment is $295.92/month. I'm not sure what the CC rate will jump to in 10/05. After I have MBNA paid off I will have $1200/month to put towards those two debts. Currently I have been rounding the car payment up to $300, paying everything extra on the MBNA and $110/month to Bank One. How quickly do you think I could get the Bank One paid off and then only have my car payment left? I'm not sure why I'm leaning towards this, what do you think? Thanks!

~leanne

~leanne

deciding to be happy doesn't mean that everything is perfect, but that you had decided to look beyond the imp

Avatar for cl_phocid
iVillage Member
Registered: 03-26-2003
Tue, 01-25-2005 - 2:22pm

When DH and I lined up all our debts, we lined them up smallest amount to largest amount, and that is how we have been paying them off, regardless of the interest rate.

All my best,
Danni

iVillage Member
Registered: 02-19-2004
Tue, 01-25-2005 - 2:24pm

I ran it two ways for you.

Scenario 1
You keep putting $300 per month to the car loan, $110 to Bank One for the next couple months then in April start putting $900 to Bank One ($1,200 total) until Bank One is paid. It will be paid in September before the zero interest period ends. Then, you put the whole $1,200 per month to the car, and the car will be paid by May 2006. You'll pay about $550 in interest from now to then.

Scenario 2
Focus on the car first, pay $110 per month to Bank One and I assumed the rate will jump to 10% after October. Since you have $1,200 each month, you have $1,090 to pay to the car (starting in April). The car will be paid in January 2006, at which time you can put the entire $1,200 to the Bank One card for a few months and it will be paid in May 2006. From now to then, you'll pay about $360 in interest on the car and about $180 on the credit card, for a total of $540.

So either way you'll pay the same amount of interest and be out of debt in May 2006 or so. But if you focus on the credit card first you'll be done with that by this September, whereas if you focus on the car loan first you'll be paying on both until next January. The other option is focus on the car and in October transfer the credit card to another zero interest card, saving you that $180 in interest. It's up to you. Any way you go you will be out of debt in less than a year and 1/2.

Photobucket

iVillage Member
Registered: 06-04-2004
Tue, 01-25-2005 - 2:34pm

Thank you, thank you, thank you!! You are all so awesome and this board has made such a difference for me! I know that I can get all this debt paid off and I am so happy that I can see the end of it! First Amendment, thanks for running the different scenarios for me, it does help me figure things out. I think I will focus on the cc card first and then the car. I will at least have the CC paid off and only have one debt to go! Yeah! That will be so great!!! Thanks again for all your advise, and if anyone else has more advise, I would love to hear it! This board and all the people here are great!

~leanne

~leanne

deciding to be happy doesn't mean that everything is perfect, but that you had decided to look beyond the imp

Avatar for mymartes
iVillage Member
Registered: 03-26-2003
Tue, 01-25-2005 - 5:26pm

Leanne,
I would payoff the credit card first. It's has the lowest balance. Then I'll attack with full force the car note.

Good luck in what you decide to do.

Just my two cents

MYM

P.S. I didn't read the previous posts before posting mine. he, he!!!




Edited 1/25/2005 5:43 pm ET ET by mymartes