I am 43, and have $15,000 in savings - and approx.$20,000 in credit card debt (with low interest.) Should I pay off debt before adding more money to savings?
Answers | 2
It all depends...what are you earning on your savings? If it's close to zero then yes you should pay off the credit card debt. If it's in the stock market which historically returns 10% over time and your credit card is low, like 3-5%, then you could make the argument to stay invested. If you are paying anything close to 10% on your credit card pay it off asap. Then don't get yourself back into debt and start saving/investing from there.
Set aside 3 months emergency fund from the cash and use the rest to pay towards the debt smallest amount to largest. It's easier to pay off that one big debt than 10 little ones. Way to go saving up. Add up the total interest you are paying each month and once you are out of debt you will be able to save that amount for yourself. Credit card debt is evil.