Money Matters
housewifehobbyist
member
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Which card to pay first?
I'm trying to pay off my personal credit card debt (not shared with H). I have all my store cards paid off (yey!) and now need to work on my two capital one cards. I have one with $3, 070 on it and one with $668 on it, same interest rate. I get $500 a month in "allowance" that I can use to pay them off. I'm debating on A) paying them both off $200/month equally or 
paying off one entirely (while meeting minimum payments for the other of course). If I choose option B, which card should I do first? I think the lower card may be more motivating because it will disappear "faster", but the higher card will be gathering more interest. Advice please?
Re: Which card to pay first?
Hi, I agree with PP's if your goal is just to eliminate your debt. That option is essentially a modified "snowball method" to clear your debt. However, if you're more interested in paying off your cards in order to raise your credit score then it might be better for you to pay down both balances at the same time so that you reduce your debt-to-credit ratios on both cards. This would depend on the limits associated with each card and therefore how much credit you're using. For example, if your limit on the second card is only $1,000, a $668 balance on that card would mean a high debt-to-credit ratio and be harmful to your credit score; whereas a $3070 balance on a card with a limit of $10,000 is not as harmful.
I would consider your goals first (debt elimination, credit score boosting, etc.) then decide how to proceed.
Good luck, hope this helps!
Since the interest rates are the same, pay off the smaller card first. It will be knocked out in a couple months.
What is this $500 "allowance" you speak of? Is it your fun money? Or are we talking like an honest to goodness allowance? Sorry, I'm being nosy.
Thank you all! I'll take your advice and knock out the smaller card first. Credit score is one factor, but mostly I'm trying to clean house while my debt is still manageable. I just finished a series of IPL treatments which were $1200, so that was a big splurge (but now all the dark spots on my face and chest are gone and I can be less self conscious).
If you can't tell by my debt, I suck money and am actively trying to be more restrained. Hence me wanting to pay every penny off this year and only charge what I can pay off that month after. H is awesome with money and controls our accounts. Sometimes he tells me we can't afford to go out for tacos, but we're buying a house this year so that's why he's in charge. I hand over my paychecks to him every week and in turn I get $500/month I can spend or save as I like for whatever I want. So yes, I am a 30 year old Director in my company who still receives an allowance!
Now I know there are some couples who call their fun budget "allowance," but I think it's beyond that if it's the only money you are allowed to spend on "your" CCs.
I second hoffse also on stopping CCs. I am moving towards this myself. I haven't paid interest in years, but I definitely overspend when I use them and have developed a bad habit of borrowing from future pay checks. In two months I have a bonus paycheck that will allow me to break the cycle and I'm leaning towards putting it in a drawer for emergencies only. H can keep using his.