I’ve been so focused (like a laser!) on getting out of credit card debt, that now I can see the light at the end of the tunnel.
And it is beautiful.
I’ll be out of it in approximately $2700, or three months, however you want to count.
But then what?
My thought all along was to take that $500 a month (ish) and apply that to my car loan.
Then, once that was paid off ($700 at a time rather than $200 at a time) I would focus on my student loans.
The debt snowball avalanche. But what if that’s not the best way to go?
Maybe I should focus on building my emergency fund instead. Right now, it has $1000 in it, not a penny more.
Maybe I should save for vacation.
I’m worried that I’ll lose my focus and spend spend spend!
Even though that’s not how I got into this mess in the first place.
I could split the difference. Right now, I’m automatically paying $450 a month into the credit card. Typically, I’ve been adding an additional $150 or $200 each month. So maybe what I should do is put that $150 into savings (automatically, of course!) and then put $450 additional into the car loan. So then, I would be paying $650 a month on the car, and still building up my savings or emergency fund or vacation fund or emergency vacation fund!
- A Relevant 12-Step Program! (frugalportland.com)
- Reducing Debt in 2012 (creditra.blogspot.com)