I spent $1707.78 on my credit card this month due to an unplanned dentist visit and holiday purchases, but I only have $1100 in my bank account. I usually pay off my credit card balance each month, but I can’t this time.
My Question:
How much should I pay off to avoid high-interest charges?
That could lead to $500 in interest over the year, so pay off whatever you can to minimize that. Try budgeting with YNAB, cut back on expenses, and maybe sell some things you don’t need.
Chase’s interest rate is around 24.99%. Split your payments and try to pay off as much as you can. Also, consider setting aside some money for emergencies starting in January.
If your statement reports on the 27th, your bill will be due in January. Can you pay part of it this month and the rest before the due date?
You need to re-evaluate your budget. Aim for at least 3 months of living expenses in savings. Pay down debt aggressively from future income and stop unnecessary purchases.
Keep your money for emergencies. Pay down the debt aggressively from future income, and build up a solid emergency fund.
Consider returning some holiday gifts or buying cheaper options. It might help reduce your expenses.
Plan your January expenses first, then pay as much as you can above the minimum payment, but keep enough for essentials.
Next time, consider using Care Credit for medical expenses, as it often offers 0% interest for a period.