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| Wed, 01-07-2009 - 3:26pm |
Hi all,
I am new-ish here and am trying to be debt free by summer 2010. So what we've been doing so far has been paying all our 12 credit cards + retail cards (yes 12! We have paid off 2 3 retail cards) $10 - 15 more than the minimum and then the extra money we have left at the end of the month ($300-500) goes to one of the cards. Initially we paid off a couple of retail cards which had low balances and higher rates to jump start our debt reduction plan and now we are concentrating on the one with the highest interest rate. However, it seems that in case I pay JUST the minimum on all cards and pool the extra money that I was giving each card($140) along with the left over per month ($300-500) and pay the card with the maximum interest, it will help us get debt free sooner by about a month. This information is per the debt calculator at bankrate.com. I was comfortable paying each card a little over the minimum as it gave me the satisfaction of seeing the balance of all cards reduce a little each month - especially since we had nearly maxed out on all our cards.
I have a faint recollection of Suze Orman talking about paying cards $10 more than the minimum and paying the extra per month to the card with the highest interest. So now I am confused as to what I should do since getting debt free sooner is definitely my first priority.
I would really appreciate any suggestions anyone may have or give me any other ideas to tackle our enormous debt.


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Hi Jennifer,
Yes, you guessed correctly, we still have many "things" to do that will need good credit scores. Dh is a resident and I am a grad student and so we will end up looking for jobs a few years down the line. We will also have to relocate a couple of times I am assuming and everywhere we go, rent/ mortgage, insurance etc will need our credit scores. Possibly in another year or so we will have to buy a car and the interest will depend of our scores. I am not sure if after paying all cards we will have a large enough saving to buy a car with cash.
So possibly keeping the cards but not using them should work.
best,
El
Most of the posters here are here because they have gotten themselves way over their head in credit card debt or used their homes as an ATM. Most of the posters here are scared and in trouble because of credit cards, payday loans and HELOCs. Have you been reading the posts here Mary Ann???
Our whole country is in financial turmoil because people were stupid with credit. Yeah, even people who were grown up and smart. Imagine that.
Listen, I have no problem is someone wants to use credit cards, it's a free country and that's your choice. But I do have a problem with your insinuation that those of us who choose to get rid of the cards and live a cash lifestyle are in someway not "grown up" or "smart".
Hugs to you.
Sue
It sounds like you have a good plan.
Good luck to you!
Sue
El:
I used to use a calulator, found online, where you could enter "what you're doing now". It isn't what you're doing now, but you could pretend that you're following the Dave method. It will then tell you how much you'll save by doing the avalanche method. I found that very powerful; but, I'll have to scout around to try to find that. Also, I thought of this thread last night as I read the Suze Orman book that is posted elsewhere on the DSG. She says to follow the method you are following, so you go, girl! I have a lot of respect for Suze Orman, even with all her FICO stuff. Now that I think of it, David Bach recommends the same method, called DOLP (dead on last payment) and I love his stuff.
I wondered if you joined the 2009 snowflake group. You'd send all your info. to Becky including your total debt, minimum due each month, and what you snowflaked beyond that amount, as well as your new debt total. It gets cumbersome when you're snowflaking on a bunch of cards, but hammering away at one should be easier to track. It's pretty motivating watching your numbers go down on the big chart.
I'll look around for the calculator I used to use.
Take care,
Dee
Hi Dee,
Once again, thanks for the support. The "avalanche" process, I think, has some delayed results initially. For example, since I am paying off the card with about 4500$ on it, rather than the one with $800 on it, I will have to wait for a while to see the card paid off but then it gathers momentum. going through the plan that the bankrate calculator has given me, there will be months later this year/ early next year when I can repay about 2 cards per month. I cannot wait for the avalanche to gather that momentum. In case you can find the calculator in your free time, I would love to have a look but please do not spend too much time trying to find it.
Do I need to send the information to Becky by e-mail or something or just post on one of the threads?
Best,
El
Hi all,
I really appreciate all the advice/ tips that I got here and the support in this board is tremendous. As many of you mentioned, no one size fits all and therefore we need to decide what will work well for us and be flexible enough to alter our plans if down the road it does not seem to work.
A few posts have brought about issues of smartness etc. and my feeling is that those of you ladies here have eliminated debt and are chipping away at debt at really smart - irrespective of the method that you have used. Those of us making a start are trying to be smart. However we have reached this level of debt (most of us will be able to justify one way or another and feel that we had compelling reasons - though others may not agree) I think the first step is to realizing that there is a problem and we have perhaps been financially irresponsible. The next step is to do something concrete about it. Does that not make us smarter than those who are still digging a deeper hole for themselves? I doubt if financial prudence has anything to do with formal education - look at some of the steps that the government has taken. So I just feel that we all should keep on trying to be in the best financial health as we an - with or without credit cards.
I am truly honored to be in the midst of such smart women here.
Best,
EL
Great summary!
Teresa
http://www.affordingpickles.blogspot.com
Well said.
Norma
"Patience is the best remedy for every trouble"- Plautus
You can email Becky directly.
Dee
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