Where to put extra $$ after tax refund??
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Where to put extra $$ after tax refund??
| Mon, 02-13-2006 - 12:06pm |
Ok, got our taxes done. After I pay off our Best Buy card, I will have $400 left. I don't know what credit card to send it to.
Here is the breakdown:
Card 1: $2,300 balance with a 0%
Card 2: $8,201.39 balance with $1,309.35 at 9.99%, $6,544.91 at 7.99%, and $389.31 at 3.99%
Card 3: $2,000 at 5.99%
Card 4: $1,041.75 at 6.99%
Applying the $400 to Card 2, and after I make this months payment, would bring it to $7,631.39 and probably pay off that $389.31 balance. Card 1 would be at $1,900 and Card 3 would be at $1,600 and Card 4 would be at $641.75.
How would you determine where to put it???
THANKS!

Well, depending on when your 0% expires and what rate that will roll to when it does:
1. If the 0% is expiring soon and going to a rate higher than any of your others, put it there.
2. If not, I would put it on card 2 so that you will expose those higher rate balances to start getting paid off and then start snowballing that card to get rid of that 9.99%.
Have you considered trying to find a better rate for all that other debt besides the 0% and 3.99%? If you qualified for those rates, you might be able to do better on all that other debt. It only took me about 30 min. last week to move mine around so I was working on a 1% rate for the next 10 mos.
Peg
Yeah, maybe you are right. I had to pay off the Best bUy cuz our deferred charges where just about as much as the item we bought, so had to pay that.
But with the high balance card, the more I cut that balance, the less my finance charges will be. My min. on that is $164 right now, and I always pay $170. This will cut my minimum to $152. And I still will be paying the $170, in fact, with my raise, if I pay $200 then by November I will be under $6,000, and in October I get about a $700 bonus I can put there. My finance charges on that card are about $50, so when I make a $170 payment, only $120 of it is going to the balance.
Yeah, I just talked myself into this one. My refund should hit my account by Friday. And I just got the bill, so I will be able to send the full $600 (the leftover money plus my pro-rated raise) to that card in one lump sum. Wow, that will feel nice! From $8200 to $7601! I can't wait until I get to a point I can make a $600 payment all the time to pay it down!
I keep a blog and it really helps. In October, I started with $20,000 in debt and I am almost at 17,000 even. My goal is $15,000 by summer, which is completely reachable. My goal is $10,000 by December....more realistically, $12,000. But if I can get to $10,000, let me just tell you, even though debt is still there, I will feel a weight off my shoulders - TEN THOUSAND DOLLARS WORTH!!!!!!!!!!!!!!!!!
Hey Plastic - if it were me, I would put the money on card #2 because you have balances sitting at different interest levels there.
All my best,
Danni
This issue of not doing balance transfers to cards w/balances seems to catch lots of folks. I almost did the same thing last week. The card I did my BT to had a $12 balance on it from one charge I had made since it was paid off. I barely remembered before she moved all that money over there. She took a phone payment (they waived that STUPID $15 fee to take my payment over the phone...I hate those) so it was cleared but I would've been so frustrated to watch that $12 lunch costing me another .50 or so every month for the next 10 months. It would've only been a $5.00 lesson learned but frustrating nonetheless. :)
Peg
Congratualations on putting it on one of the cards!! It's such a temptation to spend "free money".
Megan