Ask Terry Questions What to do wiith extra money

What to do wiith extra money

By Terry Savage on June 21, 2020 | Credit/Debt

Hello Terry! I recently have been laid off and will receive a severance around $9k before taxes. I already have another job and my bills are covered but I was wondering if I should take the money I am receiving to pay down credit card debt (~$4K) or just put into a savings as I intend to purchase a house within a year and continue to pay above the minimum payment for my credit card.

Terry Says

Well, I loved the headline in your question. I’m guessing you are paying at least 18% on your credit card balances. If you can pay them off, and still have $5,000 to put in a money market deposit account, AND if you have the SELF-DISCIPLINE not to charge on those cards again — then you’ll be in a much better position to buy a home when you get a new job and a regular income.

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