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Save or Pay-Down Credit Card

Should I keep my savings or pay-down my credit card?

I have a little debt a House, 2 Cars, and 1 Credit Card with $12,000.00 @ 4% interest no additional fees. I have very little savings only $3,500.00. Should I take this $3,500.00 and make a payment on my Credit Card or should I keep my savings and just start making payments on my Credit Card? Starting Jan 1st I will be making 1,200.00 a month payments on my Credit Card to get it Paid in Full. Please advise what to do with my $3,500.00. Thanks

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Bill's Answer
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Bills.com | Find Learn Save

If $3,500 is your only savings, make the minimum payment on your credit card this month and hang onto your savings. I suggest this because a good general rule to follow is to have 30% or 50% of your monthly earnings as in a savings account. This savings should be set aside for emergencies and unexpected expenses.

See the no-cost Bills budget guide for more personal finance tips and advice.

I hope this information helps you Find. Learn & Save.

Best,

Bill

www.bills.com/

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2 Comments

Recent Best
1500 characters remaining
  • BA
    Dec, 2009
    Bill
    Debt consolidation or resolution is not a short-answer, one-size-fits-all decision. See What Are My Debt Resolution Options? to learn more, including the pros and cons of each option.
    0 Votes

  • 35x35
    Dec, 2009
    Sandy
    My husband lost he job September of 2008, and took a job for a lot less money. Now we are making payment but some times they are late, should we do a Debt Consolidation? To have one payment to send out? What do you suggest?
    0 Votes

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