Current Events > Personal Finance Tip #1 - If you have credit card debt you shouldn't be saving

(+) Yeah! (+)

I don't give a damn what vehicle you put your money in, it would be better served going towards your credit card debt (if the introductory period has ran out). So many people make modest payments towards their credit card debt while squirrelling away cash and it needs to stop.

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i put my money into a 2016 ferrari so i bet you do care now

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Exception to this would be if you have an employer sponsored retirement plan which includes a matching %, it is wiser to hit that matching % before paying of credit card debt, in most cases.

E.g. you if you put in 8% employer matches 4%. Do that before taking that 8% to pay off your debt, because unless you have usury levels of interest, that matching 50% of your investment is greater than the credit card debt, which is like 14-30% interest cost.

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True, and moving your debt into a limited time, zero apr card is also a wise decision so the interest for a while.

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Norman_Smiley posted...

Exception to this would be if you have an employer sponsored retirement plan which includes a matching %, it is wiser to hit that matching % before paying of credit card debt, in most cases.

E.g. you if you put in 8% employer matches 4%. Do that before taking that 8% to pay off your debt, because unless you have usury levels of interest, that matching 50% of your investment is greater than the credit card debt, which is like 14-30% interest cost.

Wouldn't the returns on the match still matter? The credit card interest is compounding.

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Dat_Cracka_Jax posted...

Wouldn't the returns on the match still matter? The credit card interest is compounding.

The returns on the match of an 4% match with 8% put in is an automatic 50%. And I'm going to assume the 401k isn't investing in snake oil.

Norman_Smiley posted...

Exception to this would be if you have an employer sponsored retirement plan which includes a matching %, it is wiser to hit that matching % before paying of credit card debt, in most cases.

E.g. you if you put in 8% employer matches 4%. Do that before taking that 8% to pay off your debt, because unless you have usury levels of interest, that matching 50% of your investment is greater than the credit card debt, which is like 14-30% interest cost.

That is true, you got to take the free money before anything else

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i come from an elite background and everyone in my social circle is well off.

my first job out of college was a joke tier entry level job (but the company was a big well known one). one of my coworkers told me he straight up didnt pay off his credit card debt and was "running away" from it. to this day i have no idea how one can run away from your credit card bills lmao !

but yeah always pay off your statement balance in full every single month. dont do that minimum payment amount due shit, that's for chumps. if you're struggling with your credit card bills AND you can't save up any money cuz you're paying off so much shit, then go back and live with your parents cuz you can't afford your current lifestyle.

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Bump

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