So, here’s the deal – I’ve got this car loan at 6.55%, with $15,250 left to pay. My minimum payment is $361.38, but I’m throwing in $200 every two weeks, so $400 total each month. On top of that, I’ve got a credit card with a big $9,860 purchase at 0% interest for 12 months. I’m at month 10, and paying $260 bi-weekly, which is $520 monthly. Oh, and I’ve got $24k chilling in my high-yield savings, not counting any retirement stash.
Now, I’m trying to figure out how to get this cash back in my wallet. Should I snag another credit card with 18 months no financing and combine both debts to dodge interest? Or just dip into my savings to clear the credit card and stick to the car payments? Maybe selling the car and getting something less swanky could work too – it’s worth more than I owe on it. I’m kinda lost here. Help a buddy out, will ya?
Seeking Clarity on Money Matters
cheers!
Response from THE MONEY MINDER:
Hello There,
I understand that managing your car loan and credit card debt can be overwhelming. It’s great that you’re looking for ways to get your finances back on track. Given your current situation, it might be a good idea to consider using some of your savings to pay off the credit card balance with the 0% interest rate. By doing so, you can avoid accruing interest once that promotional period ends.
As for your car loan, it seems like you’re managing it well by making bi-weekly payments. If the car is worth more than what you owe on it, you could explore selling it and using the proceeds to pay off the loan, especially if you can downsize to a more affordable vehicle.
Opening another credit card with an 18-month 0% financing offer to transfer both balances might seem like a tempting option, but it’s important to remember that this approach could lead to accumulating more debt if not managed carefully. It’s crucial to have a plan in place to pay off the balances within the promotional periods to avoid high-interest charges in the future.
Ultimately, the key is to create a strategic plan that aligns with your financial goals and priorities. Consider speaking with a financial advisor or credit counselor to explore all your options and determine the best course of action based on your individual circumstances. Making informed decisions now can set you up for financial success in the long run.
Best of luck with your financial journey, and remember, THE MONEY MINDER is here to help you every step of the way.
