suze orman
anything goes
it depends what rate your mortgage is but I think you are better paying off the credit card so you do not have that hanging over you.
Is your credit card interest 1.9% per year? More likely it is that per month, which equates to 23% per year. I would suspect that your mortgage interest is way below that and is in the neighborhood of 6% or so per year. If that is the case, the credit card interest is eating you alive, and the balance needs to be paid off as quickly as possible.
I just checked a recent bill and am paying around $11.00 dollars a month in interest to my credit card on a balance of just less then 6,000. so I believe this would be 1.9% a year. Am I right? I owe $36,000 at 6% on my mortgage. I want to retire and don't know if I can afford to.
$11/month would be $132/yr interest on your credit card, or about 2% annual interest on just under $6000. Tha's an incredibly low rate for a CC. If it's not a special rate that will expire, you've got a great deal !! -- but if it's going to revert to a "normal" CC rate (which is about 24% per year) then paying it off as fast as possible is the route to go. Otherwise, you'll save more money by paying down the principle on the mortgage--although if you itemize income tax deductions, the mortgage interest is deductable, while the CC is not.
rac, I sincerely appreciate you taking the time to answer me.My rate of 1.9% is until the balance is paid off. Yes, that is an excellent rate I know. I don't have enough deductions to itemize on taxes.
Pay off the credit card for sure.
I'm curious why you would have use her "extra" money to her pay off the credit card faster, when its rate is 1/3 that of her mortgage, and there is no time limit on when it must be paid?
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