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Author: hrse Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308782  
Subject: Order of paying off? Date: 10/17/2013 3:42 PM
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Hello fools,

We have had some problems in the past year. Most of which 
have been softened lately.

My wife was injured last Nov and was out of work for six months, 
(no short term disability insurance) then when she announced 
she was ready to go back to work, they laid her off. Then the
unemployment office challenged the claim because they saw in 
the claim write up that she was injured and thought it was my 
wife that was refusing to return to work.

We appealled and won.

So now, although wife is not yet back at work, at least we have 
her unemployment. Time to get back to a more normal budget.
She is looking for work, but had been unsucessful. She blames
her limp. Who wants to hire a nurse with a limp?

We used to get our Health insurance from her job. After it became 
obvious that she would not be able to get back to work very quickly, 
I decieded to become an employee and give up my contracting gig. 
This will result in a preiod of two months were I get paid twice. 
Once for the contracting that is on a 60 day delay and once for my 
new employer which is on a 7 day delay.

Here is where we are now:

Debts:

Citi Card:           $0      11.49%  Recently paid down
Credit Union CC:     $0       7.24%  Recently paid down (today)
Chase Mortgage $106,400       4.75%
Wife Car:         9,800       3.99%
My Car:          12,136       2.85%
BoA HELOC:       20,600       2.49%
BoA CC:          12,300       0%    (til Aug next year then 12.99%)
Medical Bills     8,000       0%

Assets:

Emergency Fund:  10,000      recently replenished.
Retirement A/C: 401,000
Cash/Checking:    2,000

I currently expect to be able to apply an extra $500 per month above 
the min payments to my outstanding debts.

I have 11,000 due to me above my regular salary between now and 
the end of the year due from the contracting job.

I would like to use this to pay down debt. The question is which 
account?!

Simple snowball rules say you pay off the next higest APR, but that
is our primary mortgage. Also the BoA CC will not be 0% forever.

This is what I am proposing. Pay down the HELOC. Just prior to the
0% going away, pay off the BoA CC with a check from the HELOC.

What is the conventional wisdom of the board?

Thanks,

Mark

p.s. If there is other info you need, please ask.
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