(no subject)

[alexseanchai]

Between Christmas and not spending shit, amazing how the money piles up. I seem to have four hundred dollars to spare. That's more than a third of my current goal for the rainy-day fund (goal, $1000, current total, $0). That's also enough to pay off the lowest-balance credit card (current total, just shy of $400). But not both.

Advice?

ETA: Taking the advice to put $100 in savings and $300 on the card. Next paycheck, this sucker is going down.

Comments

[in_the_bottle]

Given the interest rate they charge on credit card, it would make sense to me to pay that off and stop incurring more debt on it. Unless there's no interest charged on the card, then you can put the money aside in a high interest saving and let it grow until you have to pay off the card once the interest free period expires.

At least that's what I'd do.

[jumpuphigh]

Same here.

[highlyeccentric]

Thirding this.

[red_trillium]

Tough call. One one hand I say go for it, pay off the card. But you could split it, maybe put $100 in your rainy day fund and then $300 onto the card. You can pay off the card next month, there won't be a lot of interest if you whack a bunch off the balance. And you've got a start on the rainy day fund which is a mental boost.

[jamethiel]

... the rate on the credit card will be higher than the interest you earn on your savings account. I liked red_trillium's suggestion--pay of 3/4 of the credit card, cut down your interest, pay the rest out with your scheduled payments and set the $100 aside in your rainy day fund.

You will not BELIEVE how big a relief paying off credit cards is. Particularly if you can have a sign or something saying you've done it.