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A New Hope For Our Future And Income

Well That Was More Depressing Than I Thought!

You know what sucks? Debt.

You know what sucks more? Blissful ignorance by not knowing how exactly far you're into debt.

I just spent some time going through my Mint.com account and focusing on one main goal – credit cards. I knew the numbers were going to be high and I knew interest was compounding I just had no idea how much.

Between my wife and I we have 4 credit cards. 2 we used for emergencies and 2 that we used for stupid stuff I imagine.

Anyway below here is a screen shot of my current goals. I made a slight adjustment to one of the titles for publishing purposes:

mintgoals

So that middle highlighted goal there is all our credit card debt combined. The top one is pretty self explanatory and the bottom one is my student loans. Add about another $4,000 for my wife's student loans and the numbers will be pretty close.

So out of those 4 credit cards making up that middle amount of $9,473 I went back and looked into their interest rates and now I'm debating whether I should sell a kidney or not. Two of those cards are at 19.99% and the other two cards are with a bank that cap them at 9%.

With interest that high I'm hardly paying into the actual card balance. So my next step would be to ask them to lower my interest rate except Chase and PayPal don't seem very interested in that idea.

Right now I'm considering three options:

Option 1: I could talk to my bank and see if I can get all the credit cards consolidated into one low interest rate loan. But since 2 of the credit cards are already with them that may be out the window.

Option 2: I could transfer my cards to 0% APR cards and play the balancing game every 18 months and take a minor credit hit here and there. Since we already have an established mortgage and own both of our cars this option seems pretty reasonable.

Option 3: I stop payments on my student loans by putting them and forbearance and refocus on making payments to nothing but the credit cards.

I think what I'll do now that I've kinda written what I was thinking out I'll attempt to transfer the two highest APR credit cards to 0% APR cards hopefully ones that extend for 18 months and then I'll put my student loans in forbearance and work on paying anything extra I can to them if I'm able to do so.

As of now my highest interest student loan is at 6.8% fixed while the credit cards are at 19.99% and I imagine if we missed one single payment they would skyrocket to the max APR they could get out of us.

I'd love to hear your thoughts on this especially if you've done something like this before and it worked out or if it backfired badly.

 

About the Author Adam

I'm just a guy looking to build a better life for my family by cleaning up some of our past financial mistakes.

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