Credit Card Progress and Annoyances

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When will it end?! I’m done with evil credit card companies!

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Progress:
My current credit card current balance is now $17,990.00! Yes, I’m actually happy about this.  It hasn’t been this low in years, and I’m very happy to finally turn the corner on the $20’sK to now be in the $10’sK.

I got a small year-end bonus at my job, which I was very pleased to get. I promptly applied every penny of it (what was left of it after taxes), to my credit card debt.

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Annoyances:

I got a routine monthly statement from my old credit card company a couple of days ago. This is the old credit card with a 19.9% interest rate that I paid off months ago with balance transfers to two 0% interest cards. Thank goodness I opened the email to verify my $0 balance. What I saw instead was that I now had small balance on the card for $3.99.  What?! Where did that come from?

After some investigation, I realized that I had bought a book on Amazon several months ago on this credit card, but never received it because the release date kept getting pushed out. I remember getting that book eventually, but ultimately sending it back for a refund. I got the refund. However, it did not cover return shipping, hence the $3.99 balance on my credit statement.

Ok. I open the credit card app and pay the bill, or at least I try to. Error message. The payment system will not let me make a payment for under $5.  What?!   Sigh. Fine.  I’ll pay the $5 and deal with having a credit on my account.  Nope. Error message. The system will not let me pay $5 because it is more than 7% over the $3.99 balance.  What?!  Really?!  So I guess the only way out of this is to charge something else on the card to raise the balance and then pay the whole thing off. Sneaky, sneaky.  So that is what I have done.

Grrr. Things like this reinforce my bad experiences with credit cards and particularly with this credit card company.  The silver lining, if you can call it that, is that at least this will show some activity on my account. I’ve read that not having any activity on your credit card can give companies grounds to lower your limit or close it.  I don’t want that to happen on this card – not because I will ever use it again – but because credit scores are important in the super competitive rental market out here. Even private, independent landlords require your credit report as a part of your application. This is also by far and away my oldest credit card, so getting it shut down would adversely affect my credit score.  [Edit: I’m now learning that landlords are more interested in potential tenant payment history on the report than in the credit score itself, so I may not need to be too concerned.]

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Patience, grasshopper…

No matter how much progress I make, I’m frustrated that I can’t pay it off faster.  I know that it took me years to get into this debt and it will take time to get out of it, so I need to learn patience.  I’m just ready for all this money that I spend on debt every month to instead go into investment vehicles that will result in earned interest, not paid interest.

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“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW)

‘Snowflake Stepdown’ Technique for Debt Payoff

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It’s all about motivation.

One technique that I use to stay motivated is what I call the ‘snowflake stepdown’.  I just used it yesterday and now my credit card balance is $26,998.

After I paid my most recent payment to Citibank, my balance was $27, 218. Good. It is down from it’s highest balance of $30,340.

But as I look at that balance, I think how nice it would be to put down another $220 to see that 27 go down, or rather ‘stepdown’, to 26. So I checked my checking account, and saw that I could spare $220 and make do with what was left until my next payday.

Just like that, I immediately made the snowflake payment to Citibank. Now I get to see a $26,000 something balance.  There is only a $220 difference from what was there before, but it feels like $1,000 difference.

It gives me a psychological boost. It feels like things are really starting to move. I can’t wait until my next payday so that I can throw some more money at it. The shackles are starting to loosen a little. Just a little.

Here’s to the Snowflake Stepdown Technique and positive motivation to pay off debt. Cheers.

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“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW)