Comments on: 20 ways to pay off debt faster

By: Karen

Karen — Mon, 28 Apr 2008 22:27:06 +0000

I’ve been there before. Do you have a second job? Perhaps we could write some tips this week for your situation.

By: Lynn

Lynn — Mon, 28 Apr 2008 21:42:30 +0000

I owe more each month than I bring home ($). Where do I begin?

By: bmxunc

bmxunc — Thu, 24 Apr 2008 15:17:17 +0000

It is absolutely true that closing a credit card, especially an “older” one, really does hurt your credit score, because it “re-ages” your overall credit.

By: Karen

Karen — Fri, 01 Jun 2007 03:25:50 +0000

Rockytop97: I just paid off another debt this week and will pay off the other when the bill comes in. It will be nice to be out of debt, other than the house. I agree that a house is a debt, but a house is a necessity. It seems senseless to pour money into renting something. At least you know when you are buying a home that real estate increases in value and you can get your money back out of a home (if you do it right). We’re trying to follow Dave Ramsey’s 6 Baby Steps to financial freedom. We’re working our way down the list. If we keep it up, we’ll be debt free (including our home) in about 15 years. It will be awesome to be debt free at less than 50 years old.

I could be wrong, but I think that financial advisors suggest that you pay off the credit card, cut it up, but not cancel it. It seems I heard that cancelling cards actually hurts your credit score. I’d have to check on that to be certain though.

Thanks for visiting Thrifty Mommy.

By: rockytop97

rockytop97 — Fri, 01 Jun 2007 03:00:14 +0000

Just payoff the credit cards and cut them up. I would also cancel them. Cash only. I would consider a house debt since it takes money out of your pocket until it sells, or rents for a profit. Anything that you are forced to make a monthly payment is a debt. Especially if there are consequences for not making the payment like a repo or foreclosure.

By: kellys

kellys — Sat, 17 Mar 2007 22:55:20 +0000

That is a great idea if you already have a high score. But what about the rest of us? I too have argues with credit card companies to get the interest rate down. It definitely works.

By: Karen

Karen — Sat, 17 Mar 2007 19:00:54 +0000

For sure.

My favorite way to pay down a credit card is to take advantage of the 0% interest offers. We’ve even gotten on the phone with credit card companies and negotiated a longer introductory rate. I told them, “I have a really high credit score. Someone is going to get my business. My question is, is it going to be you?” That’s great negotiating power. There is a draw back and it’s that you absolutely have to make your payments on time or the interest rate will spike.

By: kellys

kellys — Sat, 17 Mar 2007 18:53:15 +0000

Great minds think alike:)

By: Karen

Karen — Sat, 17 Mar 2007 18:22:39 +0000

I think you’re right Kelly. You know how to use the equity line. I just felt that for others, I couldn’t encourage it because so many people haven’t learned their lesson about the debt they have gotten themselves into. If people have learned their lesson and know what they’re doing, then it can work for them.

By: kellys

kellys — Sat, 17 Mar 2007 18:03:16 +0000

The reason I like using an equity line for things like paying off credit cards is that you are going to have to pay interest somewhere. Why not pay a lower rate and deduct it on your taxes? Just make sure you only tranfer one at a time so that you don’t use up all the equity at once and find yoruself in a bind if you need to sell your home.