pay off debt by emptying savings?
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pay off debt by emptying savings?
| Sat, 02-19-2005 - 5:09pm |
We have finally been able to put money into a savings account and maintain it. However, I do owe about $15,000 in debt. My dilemma is, should I empty my savings ( a modest $4,000) to pay off my car immediately or just keep making my payment? I do pay about $150 more than the required payment each month. Or is it a bad idea to practically empty savings to pay off debt? Please help!

I wouldn't empty all of it. I try to keep $1000 in savings. However, I know that my savings account gets less interest than the debt is charging me. So to me, it makes more since to pay of a debt at 12% or whatever than to earn .5% or whatever it will earn in savings.
Hope to help!
Stephanie
Travi
We decided to follow the Dave Ramsey Total Money Makeover Plan to get out of debt.
I wouldn't
Going to agree with that!
My personal take is keep $1,000 in savings as your emergency fund.
Take the rest of what's there and apply it first to the smallest debt.
Start the snowball!
:)