Hey Money Minder,
I’ve got a bit of a situation on my hands. I’ve racked up about $17k in debt on my Amex blue cash everyday card. It all started with some travel expenses and other necessary stuff after a family member passed. I’m making around $85k a year, and I manage to save up $800-900 each month to throw at my credit card debt (minimum payment is $578).
Living with my girlfriend helps a bit as we split rent, so I can put more money towards the credit card. However, according to the debt calculator, it’s gonna take me nearly 3 years to pay it all off with my current payment plan.
The interest rates on my credit card are killing me. Would it make sense to take out a personal loan with lower interest to pay off the credit card faster? I feel like I’m barely making a dent in the debt with the current setup. My credit score hovers around 740, and I never miss payments, so it’s pretty stable at least.
I’m all ears for any advice on how to tackle this debt sooner. I’m eager to free up the money I’m sinking into this and start beefing up my savings. Any help would be awesome.
Cheers,
Debt Dumper
Response from THE MONEY MINDER:
Hello There,
I’m sorry to hear about the challenging circumstances that led to your credit card debt. It’s great that you are proactively looking for ways to pay off your debt faster and improve your financial situation. Given your annual income, monthly savings, and credit score, you are in a good position to explore options for reducing your interest rates and paying off your debt more efficiently.
Taking out a personal loan with a lower interest rate than your credit card could be a wise move to save money on interest and shorten the time it takes to pay off your debt. By consolidating your debt into a single loan, you may be able to make fixed monthly payments at a lower rate, which can help you pay off your debt faster. Be sure to compare loan offers from different lenders to find the best terms that suit your financial situation.
Additionally, consider looking for ways to cut back on expenses to increase the amount you can put towards debt repayment each month. Creating a detailed budget and identifying areas where you can reduce spending can help free up more money to pay off your debt.
It’s also essential to continue making on-time payments and avoid taking on additional debt while working towards paying off your current balance. With determination and a solid plan in place, you can make significant progress towards becoming debt-free. Keep up the good work and stay focused on your financial goals.
Best of luck on your journey to financial freedom!
THE MONEY MINDER
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