Should I pay the bills off or put the extra money aside for emergency?

Question

My debt is now down to $10,000. 3 credit cards are under debt consolidation which is about $5,000. The other one is under debt collector which I'm in the middle of settling with (trying to get a settlement of 1500 in 10 payments...debt is 8 yrs old). I make money with home base business, residential care. For the last year, I'm only taking care of one elderly and my income is solely base on his rent. If something happens to him ( God forbid ) I will not have any income. Starting this month, Im able to have an extra money of $ 400.00. Would it be better off to pay my debt or save the money. I don't pay mortgage, insurance or utilities. My money just goes to credit card bills and cell bill. Thanks for all the inputs.

Answer 1

Pay off your debt. Free yourself of all obligations and then start that nest egg. Good for you for getting help and getting out of that hole. It's a tough road, but worth every baby step. Best of luck!

Answer 2

I would do three things. The first thing is to find another source of income in addition to what you have now. Second is to pay on the debt, with the third being save. Pay yourself first,by putting a little into a Money market account with a high interest rate (don't touch it). You can start really small by putting in maybe $25 a month or $50. Good luck with paying off debt and saving money.

Answer 3

I would put some aside for emergency for sure. You don't want to get in a situation where you have no cash, no income but still payments left to be made. I would also suggest taking another job or making another source of income. good luck!

Answer 4

with the interest cards charge today you would be better of paying the card

Answer 5

Set yourself up an emergency fund of at least $1,000 so you do not have to use credit if something serious comes up (and I don't mean "I wanna big screen!") Then you should work on getting rid of debt. Paying interest is the equivalent of giving your money away. Personally I want to keep my own money. Once out of debt, I suggest setting savings goals to purchase big items. Then you get the item at a fraction of the cost.