I'm working on paying off credit card debt, I have a plan in place and its going well, and I'm also able to save for upcoming expenses, a small emergency fund, etc. I just got the latest statement from one of my Chase cards, and the balance is under $200.
I have money in the bank. It is earmarked for property taxes, but I know I can make up $200 before they come due. The Chase card is second to last in my debt avalanche repayment plan, because the interest rate is only 6%. (In fact, it will be paid off just with the minimum payments before I even get to avalanche it.) It's only costing me $1 a month or so in interest, and the payment is $23.
If I pay off the card and put the $23 toward building my savings back up, it would take me 8.6 months to repay myself. If I keep paying the minimum on the card, I'll have it paid off in nine months. The interest on my savings account is nothing to speak of, so I'm not really losing anything there; paying on the card for the next nine months would cost me less than $9, so not really losing much there, either.
My inclination is to pay it off, add the $23 to my avalanche, and find a way to make up the $197 through side gigs, selling some stuff, whatever.
What do you do with those straggling little debts? Is there a threshold amount where you decide it's worth it to just pay them off and deplete your savings a bit?
Those "Almost Paid Off" Debts
May 21st, 2014 at 08:00 pm
May 21st, 2014 at 09:58 pm 1400709513
There is no right or wrong in your scenario...just personal preference!
May 21st, 2014 at 10:39 pm 1400711943
May 22nd, 2014 at 01:02 am 1400720520
May 22nd, 2014 at 04:52 am 1400734349
May 22nd, 2014 at 02:00 pm 1400767206
If your city/community doesn't have a TIPPS [Tax Installment Payment Plan] you could call your city Councillor and advocate for the program as a great many forward looking cities find the system beneficial for city coffers.
May 22nd, 2014 at 02:29 pm 1400768966
The TIPPS program sounds like a good idea, though, I'll have to see if our city offers anything similar or would consider it. I can think of a lot of families who would benefit from that type of program.
Thanks for the input!