Need advice on paying off CCs

Submitted by Alternative_Ad2706 t3_zzq9t1 in personalfinance

Hey everyone, I owe around 42k on my ccs from an investment I made which generates me around $2500 a month. Unfortunately I’m getting killed in interest and I’m noticing I’m barely lowering the balance as the month goes on. Here’s a breakdown of my cards and the interest I pay on each. What would you do if you were in my shoes? I’m not looking to consolidate, I’d be open to a loan if I could get one but it seems unlikely.

Card 1: $6,377 Interest 26.97%

Card 2: $3,585 Interest 24.24%

Card 3: $7,139 Interest 22.90%

Card 4: $5,796 Interest 25.79%

Card 5: $6,479 Interest 0%

Card 6: $1,014 Interest 0%

Card 7: $3,849 Interest 24%

Card 8: $12,551 (currently enrolled in payment plan at $431mo)

I’m not looking for any negative comments or inputs on the decisions I made to get here. I do appreciate advice, I’m still learning to manage finances at a young age. Thank you.

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Comments

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CelticsWin7 t1_j2dln7g wrote

Are you living off that $2500 and making minimum payments on your cards?

If you're serious about paying off your CC's you'll get a second job driving Uber, deliver pizza, or whatever you can find and put ALL that money towards your credit cards.

You can go high interest debt first, which is the best way financially. Or you can use the debt snowball method which is paying down the credit card that has the least amount of debt then moving on to the next card with the lowest balance.

Also, which ever method you choose, make sure your still making minimum payments on the other cards.

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McWillies t1_j2dmrkr wrote

If I were in your shoes I'd probably be shitting my pants and immediately start working as many hours as I can. The amount of interest accruing on those cards has to be gut wrenching.

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coltonzephyr t1_j2dlewn wrote

Start with the highest interest card and pay all the extra you can, while making the minimum payments on the other cards. When that's paid off...rinse and repeat.

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fromKCtoAZ t1_j2dg7uv wrote

Is $2,500 the only income to pay down these amounts?

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supernova2333 t1_j2di95n wrote

You need a budget.

It's impossible to give you advice without knowing you income, other debts(student loans, car loans, etc.) As well as any assets.

Create a budget with how much money you bring in and then see where your money goes(bills, food, retirement).

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hjarr t1_j2dkdk8 wrote

What would the loan be for? Would it be to consolidate the credit cards into one payment? Depending on what the minimum payments are for the cards and any other consumer loans in relation to your income your DTI may be too high to get a loan. I wouldn't entertain this idea in your situation.

If I were in your shoes this is what I would do.

  1. Cut up the credit cards and toss them
  2. Debt snowball. List them in ascending order and tackle the smallest balance first and close the line once it's paid off. Move onto the next and so on and so forth.

Do you have anything that you can sell on ebay for some extra cash to throw at the credit cards? Are you open to getting a weekend or afternoon job until you can get the cards under control.

Wishing you the best.

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BastidChimp t1_j2elo35 wrote

Try using either the Avalanche or the Snowball method to bring down your debt. There are YouTube videos that have extensive information on these two methods. Prep your own meals and refrain from going out to eat. Pause all investments including IRAs. Just invest enough of your salary to receive your company's matching contribution. Once you have ended your debt your options will open up immediately to save and invest more aggressively.

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Alternative_Ad2706 OP t1_j2dvj52 wrote

Hey all, thanks for the comments. For those asking about what I’m making. After bills that is what I’m able to put towards the cards monthly.

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