[USER]

My wife’s job became untenable and she decided to quit over the summer.

When she quit we had $6k balance on our credit card.

The balance never bothered us because we were paying enough each month to not pay interest.

I make enough to cover our fixed costs ($6500) each month, but our expenses are slightly more, so we’re adding about $1.5k to the credit card each month.

We have $20k in cash savings.

I anticipate my wife bringing in income again in a few months.

She’s already been offered several consulting jobs.

The only delay is she’s using this opportunity to pivot.

Worst case she can fall back on what she’s been doing.

My question is, should we dip into our savings to pay off that $6500 or should we let the debt accumulate and start paying it down in 2 months (3 months max)?

My concern is using too much of our cash. But also, I hate debt.

[Ramiro]

Cut cost, payoff the credit card and live within your means until future career endeavors improve. This too shall pass.

[Tweetie]

are you going to reduce your expenses so that you can actually stop using the card and not run the balance back up?

[Allison]

Why pay interest you don’t need to pay. I’d use the funds

[Sandra]

I just paid a $6,500 credit card and I made that money in one month of babysitting (I live in LA so I charge minimum $30 per hour)

I’m not sure if your wife would be interested in doing this but it doesn’t feel like a job.

I personally wouldn’t touch my savings because I know how hard is to get to that 20k milestone but this is only because I sat the goal to pay it off in a month.

Otherwise I agree with paying it off from your savings.

You want to avoid the credit card company closing your account and impacting your CS.

[Mike]

I’d pay it off immediately, cut costs to live within your means or earn more income.

[Sophie]

Can you transfer to a 0% credit card and keep it there until your wife finds a new job?

[John]

Pay it off and reduce costs to live on only one income. And save some as well to rebuild the emergency fund

[Julie]

How much is the interest for the credit cards? If it is like 21%, I would pay off the credit card first.

You aren’t making that in interest in your savings.

During this time, I would cut out all unnecessary expenses so you do not accumulate more debt.

[Sarah]

I am not speaking for a financial expert situation, but for my peace of mind, no way could I spend savings in bulk if I didn’t HAVE to while one of us was out of work.

I’d do what you mentioned – some plan like “we’ll do X until/unless, then we’ll pivot and do y.”

Maybe paying off the credit card can be the thing done when she gets the jobs, and/or savings can be what holds you over vs the credit card.

[Author]

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