Mommies, should I save money in my debit card account or pay off my $1,000 credit card & use that?
I'm moving into my apartment w my 1yr daughter in September. We are currently (I'm 23) living w my mother until my apartment is available. I focus is to save money, but should I save money in my debit card account or pay off my $1,000 credit card & use that for emergencies & other bills?
I must admit, it will be hard for me to save & pay off my credit card at the same time.
- sevenofusLv 710 years agoBest Answer
My husband and I work with a very good financial adviser. He suggests that if you have credit card debt that you pay it off as quickly as possible and than use the monthly payment you were making to that credit card company to either pay off another bill or put it in savings or invest it. I think your best bet is to try to pay off that credit card and than put it away only for emergencies and only if you can pay it off when it comes due. Do not use your credit card to pay bills. If you pay off your credit card by September, you will need to pay about $350/month for June, July, and August. Than, you can take that $350 and put it in your debit account to pay your bills. If you manage your budget well and put some aside in a savings account for emergencies you should rarely need to use your credit card. To keep your credit up you can use it once a month and plan to pay it off when it comes due.
- CarbonDatedLv 710 years ago
Do both. You are better off paying off the card first. If an emergency comes along before you have savings at least you have the card to use. At the same time, you aren't continually shelling out for interest every month.
It doesn't hurt to save $25-50 a month if you can swing it while paying off the credit card. It's not much, but it amounts to more than $500 in a year.
- 10 years ago
I would pay off the credit card because the longer the money is in there then the more interest you pay. Remember that with credit cards the minimum balance is just to cover some of the interest so you never get to the capital that is due. If you choose to save try paying more then what is the minimum balance. I am a freak about not having anything owing on my Visa. Also since you are moving to a new place you might find that the extra capital on your Visa will help you get extra things that you might be missing.
- BettyLv 44 years ago
You should pay off the $1,000 credit card, cut it up and cancel it. Stay with your mom until you save another $1,000 in cash to use toward emergencies. Better to be debt free than to pay it off and rack more money onto it.
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- SnowbarbieLv 710 years ago
Check what the interest rates are for each.
If the money would make 0.1% in your debit card account, and you are paying 19% on your credit card debt, pay off the credit card debt!
I just phoned my credit card company and told them that I was paying the balance off using another credit card with a lower interest rate, she immediately offered me their "11.5% Option" instead of the rate of 19.9% that I have always paid.
I took the lower rate option (it didn't cost anything), but I am a little annoyed that I have been a customer of their bank for 25 years and have always paid 19.9% interest on my credit card, and when I called to say I was closing that account down, suddenly they offer me a much lower rate!
- Ethan's MamaLv 510 years ago
Pay off the credit card.. its only 1000 you can have that paid off in 4 small payments of 250. Thats what I would do. that can be done in 2 months or less.
- Fred FLv 710 years ago
Hold some back for emergencies. But interest paid on a credit card goes on and on forever.
Interest is money out of your pocket.
- DuderoniLv 510 years ago
Put $200 on your credit card then make the minimum payment every month and save the rest ni your bank account
- Very Berry VirgoLv 510 years ago
dont use ur money in your bank.
whenever u get other money, pay ur credit card little by little
- 10 years ago
are you paying intersest on your credit card? pay it off!