How to utilize my tax refund?

[efranklin23]

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@Jen2196 wrote:

So my goal for 2014 is to finally get out of credit card debt. I have paid down quite a bit for 2013 and I am hoping this year I can finish.

My question is, what would be the best way to utilize my tax refund this year? Here are the cards I need to pay off:

Capital One $392 balance / $500 limit

Capital One Journey   $461 balance / $500 limit

Merrick Bank   $3650 balance / $3650 limit

Discover   $1563 Balance / $1700 limit

Citi Platinum   $1655 Balance / $1700 limit

Old Navy   $135 balance / $300 limit

Victoria Secret   $298 balance / $500 limit

Belk   $1135 balance / $2000 limit

Almost all the interest rates are equal on all cards except the Merrick Bank card which is the highest interest. My total refund is $1920.00, not even enough to pay off half of the debt but it is a start. Should I put all $1920 on my Merrick Bank card since it is the highest interest? Or should I pay off both Capital One Cards, the Victoria Secret Card and the Old Navy card which would leave me $634 to put down on one of the larger balance cards but give me 4 cards with no utilization...which would hopefully up my FICO score some. And I could also use the monthly payments for those 4 cards and put it towards another larger balance card to pay it off quicker.

Suggestions? Advice?

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Considering your situation, you should first put all of the money on the Merrick Bank CC if it's the highest interest. And at the moment, I would strongly recommending stop seeking credit as clearly your portfolio indicates nothing but risk at the moment. You need to take your card and simply pay off these balances atleast down to 10% for all cards as your credit is suffering due to High Utilization Rate on cards. All you're paying at this moment is interest which is not good for you financially. 

[efranklin23]

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@user5387 wrote:

Closing accounts right now will hurt your utilization.

Closing them later with low utilization will have no immediate effect, but will affect your AAoA at a later point when they drop off your reports in the years to come.

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+1 don't close your account at this moment as it wil not help your UTIL nor would it increase your CS. In fact it will do the total opposite. And it's wise to pay off the credit card that's charging you the most interest so you can save up and pay the other CLs down slowly.

[RushXTC]

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@Jen2196 wrote:

Great advice guys, I really appreciate it. I am looking at trading in my car sometime this year so I am trying to up my credit score as much as possible. I'm thinking paying off the 4 lowest balance cards and then throwing the extra money from what those monthly payments were on the higher balance is probably going to be the quickest way to get this paid off.

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This is the "Pyramid" pay off thing people always discuss... It's the best way to get rid of debt.

[Chris679]

Curious why not pay off the credit card debt before the mortgage? The fastest way to pay off debt is paying the highest interest rates first.