After a series of job losses (Business closures)my wifeand I were wallowing in a massive amount of credit carddebt. With just getting by for several months it became increasingly discouraging to read our credit card statement each month and realize that 3/4's of our payments were getting eaten by interest. We made the decision that we were going to just "suck it up" and pay the things off as quickly as we could. I have now been able to get back into my professional field and have the money to make rather large payments. We do not have 3-6 months of savings, instead opting to put all extra money into paying off credit cards. We are operating under two assumptions 1. If we saved 3 months of emergency money, we, in reality, are actually saving 3 months of emergency money to pay off credit cards, 2. Credit cards are evil, they are direct solitications from satan himself. I say that jokingly but entertain the possibility of its validity as a motivational factor. So, I encourage all of you to get rid of your debt now and not let it ride another month of minimal payments. I am also very anxious to begin my personal investing as I have learned how in the Motley Fool, but it will wait until "Satan" has all of my credit cards back in his hands.Pmad
<<So, I encourage all of you to get rid of your debt now and not let it ride another month of minimal payments. I am also very anxious to begin my personal investing as I have learned how in the Motley Fool, but it will wait until 'Satan' has all of my credit cards back in his hands.>>I couldn't agree more, both with your method and your statement of blowing off your credit card debt. Congratulations to you, Fool!!!TMF TaxesRoy Lewis
Pmad,That's truly terrific! I applaud your thinking on paying down your debt!A similar thing happened with my sister who had accrued a massive debt on her cards. She, too was making only minumum payments, and when I asked her why, she told me that she was trying to squirrel away a little in the bank.When I made her calculate the measely interest on her bank account, and then calculate what the mounting interest on her cards was doing to her, I made her realize that the FIRST thing she needed to do was to pay herself first by paying off those cards.She realized that she was actually saving more money by eliminating the debt. With that now behind her, she is now truly able to save, and is also working on building that nestegg into something substantial to invest with.TonyTMF2Aruba
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