Pay-off Strategy

[q_thurst]

Current debt situation: 

Orchard Bank - $296

Best Buy MC - $491

1st Premier - $477

GA Own Credit Union - $1008

State Employees Credit Union - Visa - $1525

JC Penny's - $427 

Macy's - $700

I have $1700 in cash that I can apply toward these balances and start to knock them down. How do you suggest I start? Should I pay off the smaller balances first and a portion of rest? Any advice would be helpful. 

Q-thurst 

[whodatnation2]

It depends on a few things. For scoring purposes it would be smart to pay off the orchard, best buy, 1st premier, and j.c. penny. However, if saving money is your plan paydown the cards with the highest interest rate's. A lot depends also on the individual limits on each card.

[LisaPA]

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@q_thurst wrote:

Current debt situation: 

Orchard Bank - $296

Best Buy MC - $491

1st Premier - $477

GA Own Credit Union - $1008

State Employees Credit Union - Visa - $1525

JC Penny's - $427 

Macy's - $700

I have $1700 in cash that I can apply toward these balances and start to knock them down. How do you suggest I start? Should I pay off the smaller balances first and a portion of rest? Any advice would be helpful. 

Q-thurst 

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Knowing 1st Premier charges crazy fees and store cards have interest rates near 30%, I'd pay those off first. That would leave you with $96 to add to your  payment toward one of the others. You could cut the Orchard by 1/3 with that.

[JohnPTEX]

My Suggestion:

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Orchard Bank - $296 (High Rates)

Best Buy MC - $491 (High Rates)

1st Premier - $477 (High Rates)

GA Own Credit Union - $1008 (More apt to work with you regarding payments if necessary)

State Employees Credit Union - Visa - $1525 (More apt to work with you regarding payments if necessary)

JC Penny's - $427 (High Rates)

Macy's - $700 (Next on the list)

This would be my game plan, but I also like to know that i paid off a lot of small things and just kept chipping away at the big things.

[FrugalRican]

I'd do:

Orchard Bank

Best Buy MC

1st Premier

JC Penny's

Alternatively,  you could do:

Orchard Bank

Best Buy MC

1st Premier

Macy's

But I'm more partial to Option 1 because it leaves 4 of your cards in 0 and you have 9 dollars left over for Macy's.

For either scenario (A or B), whatever you were paying to those that are now in 0, you start rolling into the next account (Macy's in Option A or JC Penney's in Option B).

Psychologically, this can boost morale since you'd have 3 to 4 paid off immediately. Don't take the extra money that you used to have for paying those bills and start spending it because you have "extra income"... the plan is to attack the rest of what you have.

I'm pretty sure the interest rates of the credit union cards are more likely to be LESS than those of the store cards, so when you've paid off all your other accounts, you can roll the payments of all the previous cards into the one with the highest interest rate first.

Good luck.