firstname.lastname@example.org wrote:We went with the Citi Simplicity card, 21 month no Apr BT, 3% BT fee. She was approved for 6,600 CL. Thanks guys for the Help. How much would you put on each card? Citi Diamond Preferred $8,800 CL, Citi Simplicity $6,600 CL total Balance on Freedom card $18,736
Glad she got approved for another card, particularly another one from Citi. Do you anticipate any major credit needs in the future (such as a car loan, etc)? Also, are both the Diamond Preferred and Simplicity cards 21 months with no APR?
I would load as much as of the Freedom balance as possible to each of the new Citi cards with the long-term goal of getting that revolving balance to zero and always paying in full on future spending. Regularly carrying a balance will cost a lot and isn't sustainable over time since you're not living within your means. Maxing out both of these new cards will mean her credit takes a hit in the short term. If any credit needs come up perhaps they could be in your name only? Over time it will be the most beneficial as you can aggressively tackle that balance and save on interest charges.
Anyway, I'd recommend taking advantage of those balance transfer opportunities. Don't use any of the cards for regular spending. Paying by debit card will force you not to outspend your income and will keep tackling this debt much simpler. If you can use the entire
credit lines (I've never done a balance transfer, so I'm not aware of any caps or limits that would prevent this), you could transfer $6,407 to Simplicity and $8,543 to Diamond Preferred, leaving $3,786 of the balance on Freedom. You'll have to make minimum payments on all accounts to keep them in good standing, but get that small Freedom balance to zero as soon as possible because that's where you'll be paying interest.
Math won't be to exact to the penny, but hopefully it will be illustrative:
Can you afford to pay off the entire balance within 21 months? It would mean paying a total of about $893 a month towards the balance (not counting interest charges from Freedom), but across three different cards (if not, pay down the Freedom to $0, then pay down the Citi card with the highest APR to $0, then pay down the Citi card with the lowest APR to $0, all across the shortest time frame you can manage). Perhaps you could make a spreadsheet just to spell everything out and list, for example:
- Month 1 | $893 total payment | $25 to Diamond Preferred | $25 to Simplicity | $843 to Freedom
and so on until you get the Freedom to $0 (about 5 months).
Next tackle the BT on whichever Citi card has the highest regular APR. Say it's the Simplicity. You could pay $868 a month to it and $25 to Diamond Preferred until the Simplicity is at $0 (about 8 months). Finally, devote your $893 "entire payment" to Diamond Preferred until it is at $0.
It will take organization, budgeting, and determination, but you can get this balance to $0 - even if not within 21 months total - while training yourself to always PIF in your regular spending. Then, you can start earning rewards on your regular spending
Best of luck!