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Personal Finances / Credit Cards and Consumer Debt


Subject:  Re: Paying off the balance Date:  1/1/1998  10:47 PM
Author:  shess Number:  372 of 312189

pwyles wrote:
<<Which should have priority retireing [credit card] debt or building the cash reserve for the next unplaned expense>>

The big thing here is that if you have low balances on your plastic, you probably don't _need_ a cash reserve. [I'd still _want_ one, though.] You can most likely charge emergency expenses, and meanwhile you're getting a better return from paying things down than having the money around.

Note that I'm thinking in 3-6 months cash reserve terms, here. If your cash reserve is under a month's worth, then that's clearly more important. Some things, like rent, just can't be charged, and you definitely don't want to be using those "convenience" checks to get it on the plastic.


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