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Hey ya'll! So, i've had an issue for many many years when it comes to keeping and saving my cash, or using that cash to pay off credit cards. I I know, that it has much to do with how I was raised. I'm not by any stretch of the imagination wealthy or well off for that matter in my opinion. But i did manage to save a few thousand bucks, but i carry some cc debt. It's about $4,300 right now. I generally pay the minimum payment and occassionally will do a bit more. I wrestle with myself because i'm always thinking about the "what if's." In my mind. If i pay them off with my cash, then that's all my friggin cash man!!! lol. Anyway, I rarely use the cards if any, and kind of look at them as emergency use only. Am I wrong? What are your thoughts Penny Hoardians? I need to know!!!!!!!!!!!

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I'd pay off the debt ASAP instead of paying the minimum.

Credit card debt has an extremely high interest rate generally speaking that can't really ever be earned.

Example: My chase reserve card has 16.99% - 23.99% variable APR. If you were to get a 16.99 - 23.99% return on your investment each year, you'd be quiet rich in a very short amount of time (these returns are close to impossible btw). Conversely, if you're owing 16.99-23.99% per year, you're going to be very poor in a very short amount of time - it's the opposite of investing.

It's simple math: I'd rather not have cash *now* / hustle hard / eat fast food for a few weeks and wait for the next paycheck than to carry the burden of debt the rest of my life.

Think about it: once your debt is finished, all the cash you save can be yours to invest and you'll start spiraling towards the positive, instead of the negative.

So for me personally I'd much rather take one time hit than to carry the pain for a prolonged period of time (and your pain will increase a lot over time since interest rates on card is extremely high).

That's just me though.


Last edited by Angie P.

Yes! I love the suggestion of paying extra on the credit cards, but keeping some cash, too. Thanks for asking that question, A.J. Young, because it helped me decide what to do with the proceeds from cashing out a CD when it matured. Instead of opening another CD earning less than 1%, I decided to pay down some debt instead.

Brigat, I really appreciate the perspectives of everyone concerning this topic. I feel like there are many ways to approach paying down debt and saving. There is no on size fits all when it comes to be financially free. I love your idea about using the proceeds from your CD to pay down some debt. 1% interest is a whole lot less than what we give to CC Companies in interest every darn month! Great job!

I would pay everything I had toward getting the cards paid off. Holding out money for an emergency I think is Foolish. The emergency you have now, Is owing that much in credit card Debt! Put all the money toward the Balance. Every month put every extra cent you have onto the balance of the debt. No Starbucks, McDonalds or pizza Delivery until that is paid off! Make having no extra Money HURT! It is the only way you will learn not to go back into credit card debt! If you can’t pay cash. You don’t Need It!!  When CCD is paid off. Save like a Maniac to build you a Magnificent nest egg! It gets so much easier once your not paying CC interest. Then you will have cash to pay for the things you want or need! When paying cash those wants or Needs Don’t seem to be that Desirable when your paying cash!! When you need to use your cards. Pay the full balance off as soon as you get that bill. You will be surprised how much money you will end up with & saved within a very small amount of time!

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