How much more than the minimum should someone pay?

JKSIMMONS · ‎04-21-2014

I know the easy answer is "as much as you can" but that's not what i'm looking for. I have 4 cards with a balance that I am trying to pay off. Disc, amex, chase and a NFCU card. Is there a certain % that I should pay above the minimum on each card? 10% 20% double? I want to pay over the minimum on everything and apply what's left to the highest interest card. I just don't know what % is considered good in the eyes of the lender (cough AMEX cough)

****Please, no responses of "I PIF so this is never a problem for me or I don't know bc I PIF****

asulaw · ‎04-21-2014

Well, I would stay away from letting Amex charge you interest, you automatically start to get weird looks from them with that.

As for the "as much as you can" thing, let's just say it a different way. How much can you? It really depends on how much you can afford. If you can cut back your spending and take your debts seriously then that is what you will do. There is no magic number over the minimum besides PIF, IMHO.

How most people tackle these kinds of problems is going after the highest APR first, then working their way down. Unless you favor a relationship with one of them more than you do actually paying the higher APR on another. It's an opportunity cost and that is something that I cannot answer for you because I don't know what you favor.

Wells Fargo Student - $2,300 / Discover It - $2,000 / Chase Slate - $1,500 / Marriott Premier Rewards - $5,000 / Citi ThankYou Preferred - $2,000 / AMEX TrueEarnings - $1,200 / Target RedCard - $300

Total CL: $14,300
Util: 28%

Tsuyoi · ‎04-21-2014

If your plan is to pay off your highest interest card and work your way down, I would stick to the minimum payment on all other cards unless the interest accrual is higher than the minimum payment, in which case I would pay that. Avoiding paying interest on interest should help.

Current Utilization: 0% / ~$50,000 AAoA: 7-8 Years Installment: ~$50,000 Student Loans / ~$2,000 Car Loan
Current Scores:
TU08 - 812 (8/5 BarclaysCard)
EQ08 - 843 (7/28 Citi - Bankcard/900)
Goal: Buying our first home!

PlasticOrPlastic · ‎04-21-2014

I always try to do a triple or 4x payment. Even a double payment (double the minimum) looks better than just getting by each month with the minimum. When trying to pay something off though I do as mentioned above take the highest interest rate card first and put as much towards it as possible, however I still try to maintain double payments at least on the other cards.

JKSIMMONS · ‎04-21-2014

Well I have 0% promos on all but the NFCU card but in the long run I want to use my AMEX BCE. I'm just going to stick to my plan. Once i'm at 0 debt I will be in fat city Utah and can garden my relationships then. I think i'm just getting ahead of myself. If anything, I'll throw a little more at my AMEX. It's a small balance anyway.

user5387 · ‎04-21-2014

There are certain rules of thumb here, such as paying down maxed out cards first, and paying down balances with lenders who are uneasy about balance carrying.

Paying off the highest APR first makes a lot of sense, but sometimes you might be more concerned with AA risk than saving on interest.

JKSIMMONS · ‎04-21-2014

@user5387 wrote:
There are certain rules of thumb here, such as paying down maxed out cards first, and paying down balances with lenders who are uneasy about balance carrying.

Paying off the highest APR first makes a lot of sense, but sometimes you might be more concerned with AA risk than saving on interest.

That's kind of my train of thought. Is AMEX the picky one?

user5387 · ‎04-21-2014

If I was in this situation, I'd tackle Amex first and NFCU last.

B335is · ‎04-21-2014

@EndlessRoad wrote:
I always try to do a triple or 4x payment. Even a double payment (double the minimum) looks better than just getting by each month with the minimum. When trying to pay something off though I do as mentioned above take the highest interest rate card first and put as much towards it as possible, however I still try to maintain double payments at least on the other cards.

+1

I use 3x the minimum payment as my own minimum.

JKSIMMONS · ‎04-21-2014

@B335is wrote:
@EndlessRoad wrote:
I always try to do a triple or 4x payment. Even a double payment (double the minimum) looks better than just getting by each month with the minimum. When trying to pay something off though I do as mentioned above take the highest interest rate card first and put as much towards it as possible, however I still try to maintain double payments at least on the other cards.
+1

I use 3x the minimum payment as my own minimum.

Thank for the good info!