I think that if I already had the money for Christmas set aside, I would reduce the debt. Although your credit cards have 0% interest, you still owe them the money. I say “collect your cash” from the credit cards! You’ll feel like you lost ten pounds.

One of the things money allows is opportunity and deliberate choice. Congrats, you are at the point where you can choose whether to put extra towards either debt or savings or both. That’s a lot better position to be in than having a broken down car and desperately wondering whether to pay by credit card or go to a check cashing place.

Your family is at the point where you can deal with an emergency without it creating a money crisis as well. Great job, keep up the good work. You’ll be down to half your original debt in no time.

Congrats on the fatter pockets

Having cash built up is good but having so much more in debt is a bigger stress than not having more cash.

That being said, if you’ve got 0% interest on the debt then it’s less of an issue. The important thing to remember though is the 0% is usually for a (relatively) short period of time so you’ll probably want to slash as much as you can before the interest clock starts ticking!

Then again, it’s always a nice feeling to have a stash of cash in the bank….

In the end, a 50/50 split isn’t a bad idea, given all the factors.

I found you through blog her and have been really enjoying your site.

Take Care,

Trixie

Congrats and Good Luck.

Me too. It is killing me right now to stop my 401k contribution to focus on paying my other debts. I know that it’s only temporary till the end of the year, but I wish I could find more than $100 to put into savings each month right now. It’s all going to pay down debt, which is good, but not nearly as satisfying as watching a nest egg grow.

Must. Stay. Focused. Till. 2008.

That dental bill of mine has got to go!

Like you, I think I have decided to shoot for $1,500 – $2,000 while continuing to pay off debt. Though I would also add that the debt bothers me more than the savings comforts me so I have to consider that as well.

Mar – One of the things I’m waiting on is the paperwork for the term life insurance policy we just bought for my husband. Once I get that (which should be shortly – they cashed the check), we’ll start initiating cashing out his whole life policy.

It’s all new to me, so I’m going slow to make sure we don’t mess anything up!

I’m so glad things are moving in a better directions now for you.

I’ll have to project our cash flow for the next few months. My husband’s temp job is in full swing and we heard how many hours total he has to use (the budget for him was finalized). I can factor that in now. I wasn’t including that before.

We also may be having a minor windfall from cashing out a whole life policy. There will be more about that once I know more about that

My brother did the first, he put every dime toward paying off debt and is now living debt free. I personally love having money in the bank, so I think I will split the difference and put any windfalls toward debt. Hope that helps!