@dogmeat
I agree with a plan. I do suck at making plans/lists and sticking with them. Clearly evident by the fact that I have all this debt that I am barely chipping away at over the last decade or so.
Step 1: As previously mentioned, stop using your credit cards, immediately. Don't let fear rule your actions, you are only hurting yourself by doing so. Choose wisely. Minus a few small items (maybe two of less than $20 each), I have not put anything on my cards in the last few weeks. I added those charges because I was afraid if I didn't use them, especially Discover, it would throw a flag and they would close the card.
Step 2: Figure out how to pay these down. Don't count on $1500 miracle money being available at some future date, just pay more every month, find a way to do it. Live with less, don't eat out, make your lunch or coffee at home, whatever it takes. It doesn't take much, and it adds up. I've been teleworking a lot since March 17 and until the last two weeks, our state was still in Phase I, with take out/delivery only. I live in a rural area, so restaurant options are limited unless we travel 30-60 minutes. So, eating out has dropped significantly; however, since my kids were home earlier than anticipated due to school closures, I feel like I was spending more at the grocery store. I did do grocery to go orders, which allowed me to be more aware of what I was buying and I could see what I was spending before I hit the confirm button. I wish there was miracle money! I did put my stimulus check in savings because I felt that having an emergency stash is important.
Can you up that to $250/mo payment, consistently?
$250 x 12 = $3000 paid down every year. Do that for 1.5 years and you're under 50%. 3 years and its paid off (roughly speaking).
It may also be helpful to see how much money you are throwing away in interest, as I know that's a big motivator for me. Let's say your Discover is 20% APR. 9297 x .20 = ~$1850year, ~$154/mo in interest. Most of that $187/mo you're paying on discover is just paying the monthly accrued interest, which is one of the reasons why the balance isn't moving. Up that payment, and you'll pay down principal, resulting in less interest being charged next month, and more of your (over)payment next month will thus go towards principal. It's a virtuous cycle, and likely the only practical way you'll get this debt under control. That's pretty close to my interest on my Discover card. I think the amount to interest is around that figure, maybe a couple dollars higher. I can pay atleast $250 a month towards Discover. For many reasons, I would like to be able to pay it down faster than that. 1) I'm tired of it hanging over my head and being obligated to pay for stuff I bought a decade ago (so depressing); 2) I want to save more; 3) I will at some point need another car, definitely need a new sofa and work done on our house. So, with that said, this accumulated debt is hindering my ability to put this money towards other things, whether it be savings, the house, a vehicle, etc. I can definitely pay a higher amount. I think I was caught up in paying down the two smaller balances first, then tackling the next smallest (Merrick), then Discover. Since I have the CO cards below $1,000 balance, I was thinking about making a bigger payment (about $287) to Merrick, which is due in 3 days, which will get the utlization down on that card to less than 89%. I've already made one small payment to Merrick's minimum monthly payment, so the rest of the minimum owed by 6/18 is about $54.00. I obviously want to pay more than the minimum, since most of that goes to interest. Would it make more sense to pay the rest of the minimum plus a little extra, and then make a bigger payment toward Discover? I'm kinda torn.
***I just checked my Discover statements. My interest rate is 19.9%. Seriously shocked that it isn't higher. Amt to interest last month was $154.97. Since January, the amount of my payment that has gone to interest has dropped by almost $20. Minimal progress, but I have paid a lot in interest since January. I'm really kicking myself for not being invested, sooner, in reducing this debt.
Thanks for the advice! Definitely taking all of this into consideration, as it is very helpful.
