Are you saving for a rainy day?
Do you have money sitting in the bank or stuffed in a mattress for that “rainy day”? Well, if you’re in debt, it’s raining! If you have a debt that’s in collection, credit card debt or high balances that need to be paid down, go ahead and use the money now to get out of this mess. Unless you are earning huge interest on it, you are better off to pay some of these bad debt and make them go away.
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You may be afraid to dip into that “emergency” fund, but it may only be paying 2% or some low interest rate. Your credit card debt is costing you way more than that. You may not have a savings account to dip into but it is still critical for you to pay off these bad debt items. If so, borrow it! Borrow money from friends and family to pay down your bad debt. What goes on between family and friends is private and wont show up on your credit report. Most people you know would charge you a lower interest rate than a bank, or if you are really lucky, no interest at all.
