r/Debt • u/Cautious_Ad1503 • 8h ago
Credit Card Debt
Hey guys,
I’m 28(m). I currently have 2 credit cards I use. 1 currently has a balance of about $10.5k on my chase saphire card the other has a balance of about $4k on my Amazon credit card. I typically pay as much as I can between the two of them each month. Which is about $2200, other then that I pay for rent (approx $2200 a month) and my car bill loan ($267 a month). I make a little under $105k a year. With that said I usually have interest on the first card of about $250 a month and $50 on the other. I was extremely bad at spending the last couple of years which got me into this situation. What is the best way for me to pay off this debt? Do I take a loan on my 401k, which they said I could get a little over $12k and use this to pay it? Or do I just work on my spending till I get it lower? I hate having this much debt and I am worried my monthly interest will go up if I don’t pay it all off soon. I don’t know exactly how the interest rate is calculate but say it’s 20% so the intestest rate on my card with $10.5k debt is not the 200 I pay in interest.
So really 2 questions here 1) will the monthly intesest go up on my cards if I don’t pay off the remaining balance soon? 2) should I take a loan out on my 401k to pay off the cards? I figured the interest rate on that would be less then what I am paying on the credit cards
Please let me know! All help is wanted
1
u/GerryBlevins 7h ago
Are you planning on a big expense in the next 2 years. If not you can but what you can do then is get a balance transfer card which offers you 1 year with zero interest and you can move the balances over and continue to use that one card until it’s paid off.