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Personal Finances / Credit Cards and Consumer Debt
|Subject: Re: Paying off the balance||Date: 12/26/1997 9:55 PM|
|Author: TMFRunkle||Number: 343 of 309397|
<<I agree George. While I do have several investments, I currently started stashing away 50$ a month through Transamerica cash reserve. Their current rate is 5.50 if you're interested. I kinda started out a little backwards, I started investing through drips first. But now I am paying off my debt and building up my emergency fund. Then I will be ready for some serious
I did it today. I got the checks in for my cashed in investments. One was an annuity, you can imagine the tax bite for that. The capital gains and penalties will hurt, but it still calculated as cheaper than all the interest I was paying. Anyway, I sent the check for the balance to MasterCard. It's over.
I still owe on the rug here in the basement, that's not a whole lot, and I'm still in the "interest free period". I've got to calculate what my expenses are until the next payday to see how much of that I want to pay off. I'll probably just bite the bullet and pay for it too.
I can't emphasize enough the problem that credit card debt plays on your cash flow. When you are forced to make monthly payments on a large balance, you have no cash in reserve to pay for unexpected items. Unfortunately, life is full of unexpected items. This forces you to charge those things, adding again to your balance. Also, I think for me using the credit card makes me cross a psycological threshold, making it "OK" to run up debt.
For January, I have no gasoline charges coming in, no credit charges except the $19.95 for my ISP (which I plan to have put on my debit card). A nice way to start the New Year!
My big investment for this year will be the USAA Cash Reserves, which gives about 5.5% interest. I will NEVER sneer at the idea of a cash reserve again!
Foolishly and have a Happy New Year,
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