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Should I use the savings to pay off credit cards?

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I'm paying $1500 for three credit cards every month. And, this is the minimum monthly payment I'm speaking about. If I can pay $3000 extra every month, then I can pay off the debt by mid 2017. My total savings is $10000. What do you suggest? Should I pay less on credit cards and build emergency fund? Should I use the $10000 to pay off credit cards?




Keep making credit card payments as much as you can without using your savings to do so. Emergency fund is also a must. So, create a budget, allot a definite amount for credit cards and other household expenses, and raise an emergency fund.

Consult a debt expert or ask for credit counseling for further help.

Sub: #1 posted on Tue, 07/12/2016 - 11:22

paulcahill80 paulcahill80

(Posts: 2359 | Credits: 258.2)

Hi Glenn,

It’s better if you can pay a bit more than your minimum monthly payment. If you pay $3000 toward your credit cards, you can become debt free soon. I’d would suggest you to contribute the rest of the money to an emergency fund. It’d give you protection during your rainy days.

Sub: #2 posted on Thu, 07/14/2016 - 16:58

Phil Bradford Phil Bradford

(Posts: 104 | Credits: 10.74)

It’s quite painful for a person to break the savings to pay off credit card bills. But, it may be the best option. Make sure you’re using the non-retirement savings to get rid of credit card debt. Using savings to pay off credit card has some benefits such as:

You can save on interest payments.
It will help you to improve your FICO score.
You can start savings again to secure your financial future.

However, you should talk to an expert before making the final decision.

Sub: #3 posted on Fri, 07/15/2016 - 17:37

sanderspatricia29 sanderspatricia29

(Posts: 319 | Credits: 37.4)

It is better to pay off credit cards to save on interest payments. However, it is not advisable to repay your credit cards and and not build an emergency fund. So, it’s better to make as much as you can towards your credit cards and deposit a certain amount, every month, to your emergency fund as well. This way, you can take care both without having to use your savings. And, you’ll also earn interest on the amount you have in your savings account.

Sub: #4 posted on Tue, 07/19/2016 - 18:08

Good Nelly Good Nelly
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(Posts: 2556 | Credits: 521.72)

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