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Mark Cappel

UpdatedSep 16, 2024

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

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

BBill, Dec, 2009

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.

SSandy, Dec, 2009

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?