Should I use my saving to pay off my Dept at once. ?
I have about $3,000 in credit card and collection Dept and have $2,000 in my savings Account.
The amount in my savings I was using to possibly put down on a new apartment.
But is it better to use what's in my savings to pay off my credit and collections debt to raise my Credit score all at once or just keep my saving and pay off my Dept over time.
Which is financially the best thing to do?
- WhoLv 73 weeks ago
financially paying of debt is the best thing to do
But it may not be psychologically
HAVING a debt (but with savings) may encourage you not to spend more until that debt is paid so as to preserve your savings
Being debt free (but no savings) may not stop you spending (and so not build up your savings back to where they were)
Personal finance is a battle between the financial aspects and the psychological ones
Having cash in your pocket or a credit card gives you the "feel good" factor making it just too easy to go out and spend more than you should - cos to you "debt" is only numbers on a piece of paper
On that paper the only difference between no debt and high debt is the size of the number - Its only when the number is high enough will it have an impact on your daily life - And until it does THAT you will not take much notice how big it is -
But by then its too late
- babyboomer1001Lv 73 weeks ago
Pay off your debt. The debt would definitely cause you to be rejected from at least some apartments. Keep saving and consider a second job for a short time, until you have sufficient savings to get your own apartment. $2,000 is NOT going to do it. You should have around $14,000 in the event you lose your job and need money to carry you through.Source(s): Certified Paralegal, with 25+ years' experience & with Landlord & Tenant law experience.
- Pearl LLv 73 weeks ago
if you want to i would do that
- PearlLv 73 weeks ago
if you want to i would