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Attacking Debt


zpcsc
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Hello, I need to get out of debt! I started automatic bill payments with my discover and it's gotten out of hand. My intentions were to pay in full but it didn't happen. I work on commission and when money doesn't come in the debt increases. I was able to transfer to 0 interest cards for about 13 months (I had posted and you guys replied) but I still owe a big chunk to discover. 

I have decided to take off the automatic bill pay and go back to old school where you have a grip on what is owed. Having said this, please let me know the best way to attack this filthy debt! I divided the 0 interest totals by the months and came up with what I need to pay to avoid interest once the 13 months are up, but my question is should I focus on paying down discover rather than send extra on the 0 interest cards? I'm very confused on what to do....Once I get a big commission check I will pay it all off but until then I need a strategy....

Thank you

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How many cards do you have and how many have balances?

 

Of those with balances, how much (round to the nearest $500) and at what APR?

 

If you are snowballing, then ideally you want to clear the highest APR first since that is going to be what costs you the most money in normal circumstances. 

 

You do NOT want to convey fiscal distress to your lenders if you can at all avoid it but there is nothing to preclude a basic call to the number on the back of your card to inquire about whether you qualify for an APR reduction.  If you make the mistake of asking about hardship plans, expect the accounts to be closed, perhaps even before the end of the call.  Sure you may get a lower APR, but a closed account screws you on utilization which in turn, subjects you to potential issues with other lenders.  They spook easily, especially in the present fiscal environment...

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I have a total of 7 cards, two new ones which I opened with zero interest. I received another promotion for 24 months on another card, but I don't know if it's a good idea to have so many cards. Does it affect you negatively? 

I called 3 of my credit cards with high interests, as suggested, only Amex blue lowered the rate. Actually Discover is the lowest at 13% interest. 

 

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26 minutes ago, zpcsc said:

I have a total of 7 cards, two new ones which I opened with zero interest. I received another promotion for 24 months on another card, but I don't know if it's a good idea to have so many cards. Does it affect you negatively? 

I called 3 of my credit cards with high interests, as suggested, only Amex blue lowered the rate. Actually Discover is the lowest at 13% interest. 

 

My first unsecured cc is 21.99%. It use to be 24%. My new Amex Everyday Card is 14%. 

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Make minimum payments on everything (including the 0%) except the highest interest debt.  Throw every nickel you can at the debt with the highest interest rate first.  

 

As your utilization comes down you should be able to access more low-APR or 0% BT offers.  

 

Also, take a fresh look at how you budget.  Just because your income is uneven doesn't mean you can't effectively manage a budget.  You just need a bigger cushion in savings, and you may need to stop using credit cards entirely until you get into a new financial routine that has a longer-term outlook.

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16 hours ago, zpcsc said:

I have a total of 7 cards, two new ones which I opened with zero interest. I received another promotion for 24 months on another card, but I don't know if it's a good idea to have so many cards. Does it affect you negatively? 

I called 3 of my credit cards with high interests, as suggested, only Amex blue lowered the rate. Actually Discover is the lowest at 13% interest. 

 

Having a plethora of cards is rarely a bad thing as long as you are prudent in your account management.  That being said, you don't want a ton of toy cards or, worse, store cards.  You want cards that will grow with you. 

 

We still don't know the balances in question and it appears that there are two different people raising issues in the thread, which is going to complicate matters.

 

For the poster who has no balances of note, multiple cards with a dollar is NOT the way to do things.  ONE with a two dollar balance is sufficient.  Otherwise you upset the ratio of cards to cards with a balance, which is a component of the score algorithms.  Where there is not a revolving balance, APR is irrelevant. 

 

 

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On 12/14/2018 at 7:50 AM, centex said:

Having a plethora of cards is rarely a bad thing as long as you are prudent in your account management.  That being said, you don't want a ton of toy cards or, worse, store cards.  You want cards that will grow with you. 

 

We still don't know the balances in question and it appears that there are two different people raising issues in the thread, which is going to complicate matters.

 

For the poster who has no balances of note, multiple cards with a dollar is NOT the way to do things.  ONE with a two dollar balance is sufficient.  Otherwise you upset the ratio of cards to cards with a balance, which is a component of the score algorithms.  Where there is not a revolving balance, APR is irrelevant. 

 

 

I will try that moving forward.

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