Okay, so I have an interesting dilemma. Since, I have managed to lower the interest rate on one of my credit cards it would be assumed that my repayment plan would take a bit of twist to account for the lower interest and reduced amount required to pay that balance off. Also, it would be reasonably assumed that this credit card would be shuffled to the bottom of the debt repayment deck. But due to emotional reasons, I'm really not sure....
First let recap my debt:
Credit Card #1 - My first priority. Balance started at about $20,000, and it is a card that is not normally used and has not had a charge since June of last year. A good place to start as nothing is being added, only paid off.
Credit Card #2 - Next in line. Balance started at about $20,000. Unfortunately, this is my "operating" card. I try not to charge anything, but if there are any slips or shortages in our home life this is where they end up.
Credit Card #3 - The business card. Balance started at about $40,000. This was made the last priority as any slips or shortages on the business side are charged here, and I actually don't have access to this card. As much as the hubby is reining in the spending, he's a little more prone to charging than me. (He is really trying, believe me.)
This payoff scheme was reasonable in the past as all interest rates were similar so where I started was really irrelevant. However, Credit Card #1 has just dropped rates by almost half. Obviously, the smart thing to do would be bump Credit Card #1 to the back of the line and focus on Card #2 and #3, let #1 sit charging much lower interest. I repeat this would be the SMART thing to do.
In the back of my head, however, is the problem that I always encounter, Cards #2 and #3 are never really frozen. It's kind of like that "I'll never drink again" thing that people always say, only weeks, days, or hours before they are double fisting pints of pilsner. Although we have actually come incredibly far in terms of not being dependent on credit, there is still the looming feeling that I will be trying to pay off Card #2 and #3 forever as when I finally get somewhere it'll get racked up again. At least I know that when Card #1 is annihilated, it'll stay that way as it is never really used much to begin with.
So what's a girl to do? Play it smart, with the risk that my debt repayment plans will be foiled when history repeats itself again? (I know it's pathetic, I think I'm stronger now, but I'm nervous - I think I need a 12 step plan) Or do I continue on the same journey, guaranteeing that at least $20,000 will be out the door for good, at the cost of hundreds in interest from my other cards?
I've been in this place before, and as much as I know it needs to stop, I can't help but think that I will never really see the end of my debt. So do I play it SMART or play it SAFE?
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