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Author: AmyAlyce One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308686  
Subject: Snowball Question - Kind of... Date: 3/7/2003 2:33 PM
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After several months of hurky-jerky progress on building my emergency fund, I'm finally just about ready to embark on the long-awaited Snowball Train. First stop, Chase Visa.

I will have $330 per month to add to my snowball. My budget is set up so that some of the extra money ($165) I will be sending to Chase comes out of my first monthly paycheck, while I make my normal payment ($125 + now an additional $165) Chase payment using my second paycheck.

I'm wondering if it makes a difference whether you send one big payment ($455) per month or a couple of separate payments (for me, $290 to mail back with the statement slip plus $165 two weeks later).

Do most of you who snowball send one payment per month to your credit card company, or do you send multiple? Is one way preferred over another (from the Foolish point of view)? Will sending one minimum payment and then one extra payment per month affect my finance charge or anything?

Thanks for any info you may have...

Amy
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Author: LuluB Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154545 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/7/2003 2:37 PM
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?Do most of you who snowball send one payment per month to your credit card company, or do you send multiple? Is one way preferred over another (from the Foolish point of view)? Will sending one minimum payment and then one extra payment per month affect my finance charge or anything?

You can make 2 payments PER BILLING CYCLE (at least, I can with my CC's). I would log online twice per month and make a payment. At first, when I wasn't sure how much I'd have to snowball with, I'd make the minimum monthly payment the first time I logged in, then everything I had to snowball with the second time I logged in. After I got better at it, I would divide my payment evenly. If I had $300 to snowball, I would make one payment of $150, then two weeks later, another payment of $150. YOU SAVE A LOT OF INTEREST BY DOING THIS!!!! Trust me, it really does work.

Louise

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Author: impolite Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154547 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/7/2003 2:38 PM
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Will sending one minimum payment and then one extra payment per month affect my finance charge or anything?

I do both, just depending on what bills fall when.

By sending in one payment early in the billing cycle, and another later, you reduce your overall finance charge. It can save you tons o' cash, if you make a regular practice of it.

Plus, several months of it, and you should scare Chase enough that you can call and ask for a rate reduction.

impolite


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Author: mlk58 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154548 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/7/2003 2:39 PM
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Credit cards charge interest on the average daily balance, so the sooner your payment gets posted, the less interest you owe. Once I got to the point where I was paying large amounts on a single card, I'd send in a payment every payday. It saves on interest and it's fun to watch the balance go down faster.

By the way, I use online billpay and am sold on it. Also, most of the credit companies have free online payment options and will let you make multiple payments per month. It might be worth checking out.

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Author: LuluB Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154549 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/7/2003 2:42 PM
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By the way, I use online billpay and am sold on it. Also, most of the credit companies have free online payment options and will let you make multiple payments per month. It might be worth checking out.

Definitely. But remember, when you first set up the online pay feature, be sure the send a snail mail payment that month, because you *probably* won't be able to actually make an online payment until the next month. That's what I had to do for MBNA and for FirstUSA. I cannot remember how Citibank was, but I owed nothing when I set it up so I could make online payments.

Louise

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Author: SouperStarAlison Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154552 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/7/2003 2:46 PM
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I make more than one payment a month, mostly because I work 2 jobs, and one is waitressing, so not always a stable source of income.

When I get my bills, I send the minimum to every card (plus any snowball amount I may have then to the target card)

Then throughout the month, Every Monday if I had a good tip weekend, or at least every other Wed when my other job pays, I send in a payment.

Alison

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Author: dianakalt Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154585 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/7/2003 6:30 PM
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I'm wondering if it makes a difference whether you send one big payment ($455) per month or a couple of separate payments (for me, $290 to mail back with the statement slip plus $165 two weeks later).

Do most of you who snowball send one payment per month to your credit card company, or do you send multiple? Is one way preferred over another (from the Foolish point of view)? Will sending one minimum payment and then one extra payment per month affect my finance charge or anything?


Amy,

I personally pay whatever CC I am snowballing each payday, and I get paid every two weeks. The main reason I do this is because I don't want that CC payoff money sitting in my checking account where it is more easily spent on silly stuff. I also do it because sending payments in ASAP does save you interest in the long run.

d

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Author: xtn Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154601 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/8/2003 4:15 AM
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Send what you can when you can. The more you pay and the SOONER you pay it the more interest you save, assuming your credit card charges interest based off of your average daily balance, which I think most do. The sooner the payment is credited, the less days you have at the old balance and the more days you have at the lower balance.

xtn


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Author: AmyAlyce One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 154604 of 308686
Subject: Re: Snowball Question - Kind of... Date: 3/8/2003 11:04 AM
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Thanks, everyone! Exactly the info I needed...

Amy

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