Hi everyone, My friend, who is 57, and I, who is 53, have regrettably made bad financial decisions. Each of us possesses two credit cards. My interest rate is 13%, yet each debt is only $6,000. His amount is just $4000, yet he is paying 30% interest. Which is preferable, paying off my debt or the high-interest ones first? Our Roth 401(k) accounts each only have roughly $15,000. We also save roughly $300 a month in savings.
6 Likes
Visit NerdWallet.com to find a credit card that offers a 0% interest rate for the first year and allows balance transfers. Use this new card to transfer the balances from your old cards to avoid losing money to high interest rates. Focus on paying off the transferred balances within the year. A 30% interest rate is so high that any savings won’t offset the cost of servicing that debt.
6 Likes
Visit a non-profit, accredited debt management firm. You won’t be able to use your credit cards during the process and will need to take an online class. The firm will reduce your credit card interest rates to 0%, and you will make a minimum monthly payment to them, though you can choose to pay more. They might also be able to waive some of the past interest. This method is effective and won’t impact your credit score. Once you have paid off your debt, you can use your cards again.
3 Likes
The fastest way to tackle credit card debt is by prioritizing high-interest cards first while making minimum payments on others. Consider consolidating debt with a balance transfer to a card with a lower interest rate. Create a budget to control spending and allocate extra funds towards debt repayment consistently. Seeking professional advice can also provide tailored strategies for faster debt relief.
3 Likes
We used Freedom Debt Relief and became debt-free in less than three years. I highly recommend their services.
2 Likes
I used to have a Discover card with a $10,000 balance. When they realized I was struggling to make payments, they decided to close the card, significantly reduce the interest rate, and set up a monthly payment plan to help me pay it off. Meanwhile, my other cards went into collections, and my credit score took a hit, but that’s just how it went.
1 Like
Hello, ok the best and fastest way to tackle credit card debt is the Avalanche method, the goal of this strategy is to pay off the loan with the highest interest rate first. You will ultimately save the most amount of money on interest by doing this.
Thanks for the tip! Visiting NerdWallet.com to find a credit card with a 0% interest rate for the first year and balance transfer options sounds like a smart strategy. I’ll focus on paying off the transferred balances within the year to avoid high interest costs.