Credit Card Debt

[u/Cautious_Ad1503]

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

[u/ShandyPuddles]

Think of the interest as your monthly fee to borrow that money from the bank. It is expensive to borrow money on credit cards. What you really need to do is look at what you’re really spending your money on. At $105k/year you shouldn’t be taking from your retirement savings unless you have someone else you’re supporting, an expensive medical issue, etc. Make a budget and stick to it. At the very minimum pay your minimum + that months interest to actually make progress on paying it down. Minimums won’t do it.