Korean Job Discussion Forums

huck · Joined: 19 Jan 2003

Let's say you have 3 credits cards you owe money on...One has a $3000 balance, one has a $2000 balance, and one has a $1000 balance...

When sending money home to pay them off, would you work on paying them off one by one, while paying the minimum payments on the others, or would you spread it around and pay $600/month on each one?

I have no idea which would be the better way...or even if one way is any better than the other...thanks..

dogbert · Joined: 29 Jan 2003 Location: Killbox 90210

pdxsteve · Joined: 29 Sep 2004 Location: Bundang

Yo!Chingo · Joined: 06 Dec 2005 Location: Seoul Korea

The general rule in the past from finanacial advisors has been to pay the credit card with the highest interest rate off first. Recently however some advisors have recommended that you pay the credit card with the lowest balance off first regardless of the interest rate on that card; the rational? People get almost instant gratification from paying off their debts this way. This gratification drives them to do it again and again!
It really depends on what type of person you are too. For me I'll go for the highest interest rate everytime b/c I'm good with staying on task and being discipled. For others, the gratification of paying off the debts keeps them going.

huck · Joined: 19 Jan 2003

Thanks...I've been so used to paying off my credit cards each month, that until I started using them for my first month back, that I've never even had to think about the interest rate....

I checked, and now I know which one to pay off first...

Kahmsamnida

wwidgirl · Joined: 20 Mar 2005 Location: Seoul

call your banks and consolidate your credit cards. This is really easy to do and usually the bank that you consolidate to will give you a low rate of interest. That way you'll only have to pay off one card.

Yo!Chingo · Joined: 06 Dec 2005 Location: Seoul Korea

Ya-ta Boy · Joined: 16 Jan 2003 Location: Established in 1994

The real question is: Why would anyone run up a $6,000 credit card bill just before leaving the country? New underwear and a couple of dress shirts don't cost that much.

huck · Joined: 19 Jan 2003

I came to Korea.....Got my own place, and had to wait 2 months for my first paycheck....And I had just finished a 4 month vacation in Thailand....So, a few plane tickets, furnishing my house, etc.....

But thanks for asking.... Wink

RobinH · Posted: Tue Jun 20, 2006 8:10 am Post subject:

Pay the minimum on the 2 with the lower rates, monthly pay as much as you can afford on the other one until you've paid it off. Once you've paid off that card, take that monthy amount and apply it to the next card until you've paid it off. Do the same with the last card. You'll pay the same amount each month until you've finally paid off all the cards. It takes some perseverance, but you'll feel great when you're finally done.

pegpig · Joined: 10 May 2005

I gotta agree with the guy who said go to the bank. Our friend had 2 credit cards of 18% and 19% ( or something like that). She went to the bank and got a line of credit at 10ish% basically cutting her interest costs in half. You'd be saving $40~50 a month.

She wanted us to help. My tip for the day: Don't lend money to someone who owes $10000 on two credit cards. We suggested the bank. That's help enough.

SuperHero · Joined: 10 Dec 2003 Location: Superhero Hideout

pdxsteve · Joined: 29 Sep 2004 Location: Bundang

ChopChaeJoe · Joined: 05 Mar 2006 Location: Seoul

You definitely don't want to pay the minimum on ANY card. Pay as much as you can on all of them at once.

Call your higher interest cards and see if they will match the rate you are getting for your lower rate cards. They want you to use their card, they're likely to do it.

I would add that making two half-sized payments per month is a lot smarter than paying once a month, but with only a monthly paycheck, not much point in that.

pegpig · Joined: 10 May 2005