Thursday, February 24, 2011

The Debt: Balancing Credit Card Debt and My Credit Score

Money is not my thing.

I dread dealing with money in any sort of way. It gives me terrible anxiety, partly because it requires some form of arithmatic, and  partly because it's simply money.

About four years ago, Sean and I moved into this home and I purchased a set of new washer and dryers from Sears for about $2500 on credit. I never thought about budgeting out the monthly cost, I'd just pay the minimun and get on with life.

I made a late payment.

My interest shot up to 29%.

Four years later, I still owe $1500. *facepalm*

I can not believe it has taken me so long to pay down this debt. I can not believe it will still take me another three years to finish it off. However, I did change the game plan up a bit. When we received our income tax check this year I asked Sean if he felt we should just go ahead and pay off the card. His advice, take out a secured load for the amount, pay off the bill, and then make monthly payments back to the bank, with a lower interest rate, of course.


Working in education, I'm associated with a great credit union and headed over to see them yesterday after work. I set up a secured loan where they hold $1500 in my savings account, freeing up each amount that is paid off each month, pulling it straight from my pay check {there will never be a late fee again }, and only charging me $30 worth of interest over the 38 months that I'll pay off the loan.

$30. I was paying that each month on  my credit card.

I'm thrilled to have found a way to maintain monthly payments, which raises or keeps your credit in good standing, as well as paying off this debt that has linger for far too long. Next time I make a big purchase, I'll definitely be thinking about the long haul & what it will takes to pay if off.

What about You? How debt savvy are You? Do you balance out your debt? Do you check your credit score yearly or simply feel you're in good enough standing?


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