Why I'm still paying off debt instead of building an emergency fund - Business Insider

series. The idea is that having an emergency fund can break the reliance on credit cards.

But, I've always felt in control of my credit card use. Like the decision to spend on the renovation projects, most of my credit card swiping comes after careful consideration. I'm not someone who recklessly spends, so I didn't need the emotional control of avoiding credit cards at all costs. In my mind, it made much more sense to avoid paying interest. I would rather pay $1,000 toward credit card debt and save money every month on interest than have it collecting minimal interest in a savings account. Plus, in a real emergency, I could use my credit cards and then create a plan to quickly pay them down. Now that our home projects are done, I sat down to crunch the numbers.

But, the minimum monthly payment on the debt we racked up during the renovations is substantial: about $200 a month. A significant chunk of that is interest. By prioritizing payoff, I can reduce our outgoing expenses and save money on interest. Both of those ideas make lots of sense to me at a time when we're tightening our purse strings. During this economic crisis, I'm doing my best to carefully budget my income.

Of course, in an ideal world I would be able to handle financial challenges with cash on hand, but for now I would rather that cash be working to reduce my overall debt, and to improve my financial security for the future.

'I'll be honest: Even before this financial crisis, it never made sense to me to build an emergency fund while having high-interest debt.' I guess the author now knows that funding your life with high-interest debt isn't as smart as living within your means?

Belgique Dernières Nouvelles, Belgique Actualités

Similar News:Vous pouvez également lire des articles d'actualité similaires à celui-ci que nous avons collectés auprès d'autres sources d'information.

Why coronavirus recession recovery will be faster than Great Depression - Business InsiderIssuing state and local aid before possible budget deficits can help avoid 'a huge drag on the economy,' an Economic Policy Institute director said. it will Hopefully it will be deep but short recession. The world now is completely different then 100 years ago
La source: BusinessInsider - 🏆 729. / 51 Lire la suite »

Why cruise lines will be loser in $500 billion corporate bailout program for coronavirus - Business InsiderThe largest cruise lines are incorporated outside the US. That means they won't be able to get a cut of the bailout money under Trump's stimulus law. Prison ships they flaunt tax avoidance and expect us to save them..good one I’m all for the $500 billion corporate loan program but these guys shouldn’t get a dime. Go to the country where you’re “headquarters are”.
La source: BusinessInsider - 🏆 729. / 51 Lire la suite »

Why Index Ventures invested in $2 billion productivity startup Notion - Business InsiderThe young startup had previously avoided taking venture capital from established firms, but took on Index Ventures amid broader market uncertainty. terrorist organization, the PKK's Syrian wing, which sent $ 1.2 million of materials by the US government , including gloves, masks, surgical kits, and oximeters, to resist coronavirus, A nurse from the USA crying with tears , refusing to work without a mask.
La source: BusinessInsider - 🏆 729. / 51 Lire la suite »

Amazon Workers are afraid to go to work — here's why. - Business InsiderAmazon workers claim the company is not doing enough to prevent the spread of COVID-19 throughout their facilities and the communities they serve. Don’t worry be happy 😆 Is this worker a pathologist? Covid-19 Rideshare Drivers Protection Funds CALL TO HELP ALL RIDESHARE DRIVERS UBER LYFT WORLDWIDE! Please make your donation at COIVD19
La source: BusinessInsider - 🏆 729. / 51 Lire la suite »