Desert Schools Federal Credit Union News

Good Ideas To Save Money And Suggestions To Pay Off Credit Card Debt?

May 07, 2009 by blk600cc | Posted in Personal Finance

Lil' story on me. I currently have about $6,500 worth of debt. BUT, I have stuff to show for it. I have about one year left of college from getting two degrees (Fire Proficiency and Automotive), I have a nice street bike (motorcycle) and I learned that Credit Cards are not something to rely on. I thought it would be good but tittle, I learned that they can get you in trouble. And I rarely use them anymore. Good thing before I got furthur in debt. But most of my debt went to my bike (did a liquidate advance for my loan), my schooling and my ex-girlfriend haha.

So now, school is coming to an end next week and I'm looking to work a certain extent a bit making decent money during the summer. Nothing spectacular since I'm 19 and don't have a degree yet but something to where it'll help.

Anyway, I plan to sell my bike for perchance $3,500 in August. I just want it for the rest of summer and then sell it to decrease my credit card debt even more. So since I'm dependable I can sell it, that knocks the debt down to about $3,000. And add a job and selling what I can around the house on eBay, I'm hoping to have the debt down to about $1,500 by the end of summer with my bike gone :(. But, I poverty to do that to make ends meet. As much as I hate to say that. Oh well, I have a car anyway.

But as of now, I'm $6,500 in credit card debt. I explained my plans but is there anything you can recommend doing to conserve money? My debt is with three credit cards combined. One of them, I cut in half and then again in multiple pieces because I was using it too much so this way, I can't use it again and my only choice is to pay it off fully and then delete (Capital One), another one is with my current bank (Washington Mutual) and the other one to which the debt is the greatest, Desert Schools Federal Credit Union - the one I did a cash advance for my loan with.

Desert Schools is the most, then WaMu, then Top-hole One. Any suggestions on what to focus on to pay this off with the best strategy? Thanks.

And like I said, I rarely ever use my credit cards (maybe once every two months) but I needed the bucks and now I take responsibility to pay it off. Just looking for some help and insight. Appreciate it.

Govern 1: resolve to operate on a cash basis and use a brand name debit card off your checking account for your electronic payments. Conserve the credit cards for emergencies and textbooks you forgot to budget for.

As for the credit card bills: treat the whole debt as a single lend to be paid back. This gives you a stable budget, visible progress, and a end date you can predict with some confidence.

Set a fixed amount you're universal to pay each month for as long as you still have debt. Identify the card with the highest interest rate and set that aside. Write checks for the lowest payment on the other two cards and put the remaining money on the high interest card. While you may balk at the minimum payments ("That's how I got in get in the first place!") what you're doing is repaying the most expensive borrowed money first. Every dollar on a 24% card costs you about 2 cents every month, while a 12% union card costs just one cent.

Next month, do the exact same thing with the same amount of money. Minimum payments on the first two, maximum payment on the drugged interest. As the principal goes down, the interest goes down too and the money you pay in gets more effective every month.

When the high interest card is finished off, again use the same budget and MO but focus on the next highest interest rate. And repeat until you're done!