Help Distributing My Debts

Discussion
1

I took out a 401k loan for home expenses we couldn’t afford, and I ended up with $10k more than expected. I’ve been thinking about how to best use this $10k to pay down $18k in debt.

In the far-right column, I’ve outlined my plan for distributing the $10k to pay off various debts. Two of the credit cards also have my wife on them (labeled as shared), so I’m prioritizing those over the one with a higher interest rate.

Additionally, my rent is going up by $400/month, so I’m hoping this plan will help free up some extra money to cover that increase. Currently, covering the rent hike is going to be a stretch, especially with the card usage and the $99 per paycheck going toward repaying the 401k loan.

Am I making the right decisions, or would I be better off handling this differently? Thanks in advance for any advice. I’m really tired of being stuck in credit card debt and trying to get out.

TL;DR: I have $10k to pay down debt—am I distributing it correctly in the projected column?

Help distributing my debts
Help distributing my debts1080×498 31.7 KB

2

If you have credit card debt with high interest, think about moving it to a card with a lower interest rate. Just be mindful of any transfer fees and know that introductory rates might only last for a limited time. :crazy_face:

3

If you have credit card debt with high interest, consider transferring it to a card with a lower rate. Just keep in mind there might be transfer fees, and the lower introductory rate could only last for a limited time. :melting_face:

4

Your prioritization of paying off the shared credit cards first is a wise decision. It’s generally a good strategy to tackle debts with higher interest rates first to minimize the total amount you pay.