Tonight I hung out with my good friend who is a CPA. We went out for wings and after a few hot ones the subject of taxes came up and somehow that led to my debts. He asked how much debt I had and I mentioned to him the events of the last couple of months and the current balance with CITI. I explained to him that my goal is to pay off the smallest debt first and ignore CITI for a few months. He asked me about interest rates and suggested that I pay off the higher CITI balance which accrues interest every month, around $100. Here is the breakdown of the debts by interest rate:
CITI: $10,983 balance, interest rate is 11.99%, minimum payment is around $225.
CITI Professional: $1,758, interest rate is 0% until August 2008 with minimum payment.
BEST BUY: $1,706.59 0% until January 2011 with minimum payment, usually $20.00.
ROOMSTORE Furniture: $549.59, no payments, no interest until August 2008.
So I’m debating whether to pay off the furniture in March and make some progress (the Ramsey method) or pay off CITI and save some interest until July (his advice). I really don’t know how to proceed, I think I want to pay off the furniture and be done with that account… that way I will only have 3 accounts on this blog instead of four.
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