The Benefits of Saving v. Paying off Debts
We live in a world that often seems ruled by credit. It starts early too as you might have a small credit line at a school snack bar, then a department store credit card, and maybe a car too, even if you aren’t at the best interest rate to begin with. The more well-behaved you are at making payments and being smart with your money, the higher your credit rating climbs. And once you begin to get closer and closer to that famed pinnacle of 850, the less you want to let go of it. But unforeseen circumstances may come along that cause you to start re-thinking what is better in the long run.
IS IT BETTER TO SAVE NOW & WORRY ABOUT CREDIT LATER?
Is it better to keep your money in savings, with a nest egg or an emergency fund, or continue to pay on what may be monumental credit card bills or student loans that are causing you to sink deeper and deeper into financial distress? After so many years of worrying about the credit report, it can be very hard to consider letting that go for the greater good of your finances. At a crucial point like this, you should consider contacting a law firm like Fitzgerald & Campbell, APLC, experienced in helping clients explore their options when debt has reached the crisis point.
INTEREST RATES VERSUS THE EMERGENCY FUND
Interest rates are of course a major factor when it comes to deciding whether to save your money in a modest, interest bearing account or paying off a credit card that may be in the double digits. Obviously, if you are planning on following through with a dedicated payment plan on a loan, getting rid of those high-interest payments is the smarter choice. Often though, these are the choices you can make when you are in better financial shape. If you are more worried about survival, then a shift in priorities may be in order, with the credit rating taking a backseat—not forever, but just until you get back on your feet.
OTHER FINANCIAL PLANNING OPTIONS MAKE WORK FOR YOU
It may be that a debt consolidation or debt settlement plan is a good idea. The question is whether you would be saving enough to cause you to want to dip into your cash reserves. The consolidation will offer you one monthly payment and perhaps at a significant dip in interest payments. The settlement angle, however, would mean paying out lump sums of cash to pay off creditors for negotiated settlements that are less than what you owe (hopefully).
Beyond these options, continuing in the vein of serious financial planning when crunch time hits, you may also want to explore the idea of a Chapter 7 or Chapter 13 bankruptcy plan, discussing with your attorney which option would suit your situation best.
CONTACT US NOW
But if you are at a crossroads financially, contact Fitzgerald & Campbell, APLC so that we can discuss a plan that is best for your current finances, and future. Our team of attorneys have decades of experience in helping clients navigate issues such as credit card debt, lawsuits, bankruptcy, and more. We are here to help you!
Call us today for a free consultation at (844) 366-8693, or email us at firstname.lastname@example.org.