BFC Newbies Thread: 33% of the interest paid is tax delectable

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > BFC Newbies Thread: 33% of the interest paid is tax delectable

illamint: Jun 26, 2005; According to The Oxford English Dictionary, the word "snapshot" was originally a hunting term.

I've got a quick credit card-related question. I'm a student, graduating in May, starting a job in July for $75k/yr. Right now, I have the following debt balances:

Schwab Visa, $1554.52/$2500, 8.24%
Chase Visa, $1480.37/$3100, 18.24%
Federal Direct Loans, ~$21,000, not yet paying anything on it

No expenses other than me spending too much on restaurants and poo poo, $720/month income from my on-campus job, savings from my summer internship all but exhausted, practically no savings or cash otherwise. Paying about $100/month on each card. Credit score is 730. My question is this: should I bother applying for a 0% APR card to balance transfer this debt, especially the Chase debt, to? Or is it not worth it? As soon as I get my first paycheck I'll be able to pay off my credit cards, so I'm not too worried about carrying the balance for another 4 or 5 months. My biggest problem is that I'm still spending like I was this summer when I made 4 times what I do now, so that's why I have the balances.

# ¿ Mar 2, 2010 19:53

Adbot: ADBOT LOVES YOU

# ¿ May 5, 2024 22:32

illamint: Jun 26, 2005; According to The Oxford English Dictionary, the word "snapshot" was originally a hunting term.

Grumpwagon posted:

$100 isn't nothing, obviously, but I'd concentrate on reigning in your spending first. If you want to do the balance transfer, make sure to consider any annual fees, and make sure it's a decent card. No sense getting an inquiry and a new account (and lowering your average age of accounts) unless it's a good card you'll use afterwards.

What I'm trying to say here is, considering everything, I don't think it's worth it for you to open a new card, unless you get lucky and stumble on to a great card with a 0% offer, which doesn't happen nearly as often as it used to.

OK, so, I did happen upon a new card with a $4,000 credit line at 0% for 7 months on purchases and balance transfers (with the perfunctory 3% BT fee). My total balances are about $3,200 now; should I transfer them all to the new card? Would it matter if my utilization of one card is about 75% but across all three cards is about 33%? It stands to save me about $150 over the course of that 7 months if I pay it all off. I mean, it seems logical to do it, but is there any reason I'm missing not to?

# ¿ Mar 25, 2010 19:53

illamint: Jun 26, 2005; According to The Oxford English Dictionary, the word "snapshot" was originally a hunting term.

slap me silly posted:

Are you sure you calculated that right? I make it more like $50 saved after accounting for the transfer fees. Not that that's a bad thing, but the other side of the coin is whatever that 0% card is going to turn into after 7 months.

I've got about $1700 now on an 18.24% card, so that'd be 1700(1+.1824)^(7/12) at 7 months for about $172, right? Then 1500(1+.0824)^(7/12) for the other card for about $242 interest over 7 months versus $96 for the balance transfer. The new card's only 14% after 7 months anyways, so that's better than my Chase card anyways.

Edit: I think my math's an undershoot actually because I got the compounding wrong, so I might even save more?

# ¿ Mar 26, 2010 00:27

illamint: Jun 26, 2005; According to The Oxford English Dictionary, the word "snapshot" was originally a hunting term.

Sovi3t posted:

Just got my A.S. in Computer Science and starting a new job in two weeks.

*snip*

[*] Getting my B.S. In one year my employer may start offering tuition benefits. How high of a priority should I make this?

Definitely take advantage of it. If you're good (i.e. not a wannabe CS major), your salary prospects will skyrocket with a B.S. Skyrocket. No one in my graduating class who actually got a job and isn't going to grad school is making less than $75,000.

# ¿ May 28, 2010 04:50

illamint: Jun 26, 2005; According to The Oxford English Dictionary, the word "snapshot" was originally a hunting term.

OK, so I have a question about emergency funds. Is it better to be paying off short-term revolving debt or to be building up an emergency fund? I have practically no savings having just graduated and spent myself into a corner. After fixed expenses such as rent, car payment, car insurance, etc. (but not including groceries or just "spending") I have about $1700 a month left over, and 100% of which is going towards paying down the remaining $4500 or so of credit card debt I have.

My plan right now is to cut spending and pay down my credit cards as fast as possible so as to eliminate that portion of my balance sheet; the question is whether or not I should be putting everything left over towards that plan or if I should keep some of that liquidity around for emergencies or to make cash purchases instead of putting everything on my credit cards like I usually tend to do.

# ¿ Aug 8, 2011 23:24

illamint: Jun 26, 2005; According to The Oxford English Dictionary, the word "snapshot" was originally a hunting term.

moana posted:

illamint, would your parents be able to float you cash in case of a true emergency? If so, I wouldn't worry about building an emergency fund and just slash that debt as soon as you can.

Parents are probably worse off than me, but between other family members I could probably come up with something. Certainly not for more than a month or twos worth of expenses, though, hence the concern. I think I'll do what Dead Pressed said and work towards having $1000 on hand, and then I'll go from there. I've got a 0% balance transfer offer from Citi that can let me consolidate my higher-interest cards into one, so I can take what I would've been paying on those and put it towards some savings.

# ¿ Aug 9, 2011 00:42

Adbot: ADBOT LOVES YOU

# ¿ May 5, 2024 22:32

illamint: Jun 26, 2005; According to The Oxford English Dictionary, the word "snapshot" was originally a hunting term.

Zeta Taskforce posted:

I�ve gone on zero percent rants before in this thread if anyone is curious, but to reiterate, the cost only starts with the balance transfer fee. This can be hundreds of dollars up front.

To be clear, it's a 0% balance transfer offer on my existing Citi card, coming from a Chase card at 18.24%. I'm not opening a new line of credit, and I plan on freezing that card rather than closing it, since it's my oldest open account. The balance transfer cost me $39, which was two months of interest for me on the Chase card. The interest may come out to be a wash in the end, but it's also nice to consolidate and be able to just be done with the Chase card. I don't see too much of a problem with this.

# ¿ Aug 9, 2011 22:54

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > BFC Newbies Thread: 33% of the interest paid is tax delectable