I need some advice on paying off $10,000 in credit card debt. I’ve looked into different strategies like the snowball method or focusing on high-interest rates, but I’m not sure which one to go with. I was also approved for debt consolidation, but the interest rates are still a big challenge for me. Even when I pay more than the minimum, it feels like the interest eats it all up.
Here’s a breakdown of my expenses and debts:
Home:
Rent (including water & trash): $1200
Entertainment: $32
Wifi: $20
Electric: ~$130
Credit card balances (APR):
Capital One (28.99%): $6,162.05
Ikea (21.99%): $2,283.39
Target (27.90%): $516.05
TJ Maxx (31.99%): $428.76
Other:
Tax debt: $3,500
Loans from family/friends: $2,700
For context, I moved out of my friend’s place and got my own apartment, which meant buying furniture and paying deposits. On top of that, I had to take an emergency trip back home, and only part of it was covered by paid time off. I made some careless spending choices too, but I’m trying to fix things. I’ve picked up a second job for extra income, and my friends are helping me save by cooking meals together so I can avoid eating out. I’d appreciate any tips or advice to handle this better.
You might want to look into debt relief services. I was in a similar spot with $11,000 in credit card debt, and they helped me reduce it to $6,000. The whole thing was done in about two years.
Lior said:
You might want to look into debt relief services. I was in a similar spot with $11,000 in credit card debt, and they helped me reduce it to $6,000. The whole thing was done in about two years.
Lior said:
You might want to look into debt relief services. I was in a similar spot with $11,000 in credit card debt, and they helped me reduce it to $6,000. The whole thing was done in about two years.
I’d tackle TJ Maxx and Target first since they’re under $1,000 combined. Then move to Capital One, followed by Ikea, and leave the other debts for last.
Kai said:
I’d tackle TJ Maxx and Target first since they’re under $1,000 combined. Then move to Capital One, followed by Ikea, and leave the other debts for last.
But doesn’t the interest on the bigger debts make this harder in the long run?
Save one month’s worth of expenses first—around $1,500 in your case. After that, pay minimums on everything and throw all extra money at the smallest debt. Work your way up to the bigger ones.
Why not combine the snowball and high-interest methods? Clear the smallest balances first for a quick win, then switch to tackling the higher-interest debts.
Mai said:
Why not combine the snowball and high-interest methods? Clear the smallest balances first for a quick win, then switch to tackling the higher-interest debts.
Thanks for the suggestion, this sounds like a good balance!