Hi guys,
I (27F) have a credit card account with $546.06 with a 29.99% interest rate (I know terrible rate but unfortunately I didn’t know better in college fml). I was on the way to completely paying it off by the end of the year but unfortunately my salary has decreased drastically from ~$57k to only making $80 a day and working 3-5 days a week.
Anyways, I called Barclays about reducing my ridiculous interest and they could only refer me to the “hardship” phone line and told me I’d have to close my account to receive a reduced interest rate. I’m not sure if closing one of my oldest accounts with the largest credit line is worth the credit hit or if I should just hope to be able to pay more than the $29 minimum for the potentially next 3-8 months.
Here’s some other things to note about my finances:
I split shared bills with my gf (26F) such as rent & utilities ($800-$850 each), electric (~$85 ea), groceries ($200-$300 ea) and a loan on mattress($100 ea). She makes about $60-$65k and we live in Texas.
My monthly personal bills include
– Credit card
– Student loans (all federal and on SAVE I think)
– Teacher cert courses $99 (no interest)
– Phone bill: $120.74
– Car insurance: $124.83
– Gas: $60
– Psych and meds: $35+$30
– Ez Tag: $20 * I avoid going on the toll as much as I can.
– Subscriptions: ~$20-40
Let me know what I could do 😭
Do I keep my oldest and biggest credit line open or close it to receive a reduced interest rate
byu/842betttt inpersonalfinance
Posted by 842betttt
8 Comments
Honestly, I would maybe call back and see if you get a different person that’s more helpful because I feel like a very basic piece of knowledge is to never close out your longest credit line because then that’ll prob drop your credit score etc. any chance your second oldest account is anywhere near your First?
Obviously keep it. Pay it off then stop going into CC debt. What’s the question?
Other comments, car insurance is too high unless you have tix/accidents, phone bill is too high. Why are you paying $100 a month to loan a mattress. Buy one.
You need a better job or a second job, immediately. The CC with a low balance and 30% interest rate isn’t your problem, at this point you can’t even afford your rent and groceries.
Also wondering how your phone bill is so much. I have Verizon and it’s only me and I pay about $70 a month.
Close it. Take the reduced interest rate. You shouldn’t pay unnecessary interest for a credit score and your score is the last thing you should be worried about right now.
Normally I say close it and take the deal, but for $550 balance i don’t think it’s worth it.
Can you get a new card with 0%? How does your monthly spending look like? If you can charge $550 to the card with $0 fees purchases that you had the cash to pay for, and use the cash to pay off the balance that would probably be the best/cheapest move.
You’re in debt. Unless you’re desperately trying to buy a house soon the credit score is irrelevant. Close it and do whatever it takes it pay it off
Here’s some more details on my job situation:
My job situation is a bit frustrating as there was a hiring freeze (due to government budget cuts) for teachers. I was an apprentice teacher working on my alternative certification for 2 years but they had to make me resign so they could prioritize hiring certified teachers and my job was given to a teacher who has zero years of experience. I had to do this resignation in May and, over the summer, I’ve completed my exam and courses that I needed for hiring but there aren’t many options available in my district in my content area other than being a substitute teacher until further notice. Thus, my drastic pay cut.