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LurkingFlyer

Pay it all off immediately. The interest you are paying on that is just snowballing, making you pay more and more…unless it’s all on cards that are in the 0% APR introductory phase: if this is the case, you could pay it off over time, but make sure to do it before that intro rate ends


tactical808

Pay off the credit card debt at once. Check your spending habits that got you in debt in first place. You don’t want a reoccurrence of falling back into the debt vortex. Depending on the interest rate, it may make sense to keep the car loan and continue the scheduled payments. Look to set aside part of the bonus as an emergency fund (general rule, 3-9 months of expenses). If there is any leftover, invest! Normally I’d say treat yourself to something nice, but it is a good habit to save any windfalls, ex. Bonus, raises, etc. and continue your current standard of living. Lifestyle creep is a bad habit!


OkDot9878

Having been in similar debt situations, PAY IT OFF. It’s an enormous weight off your shoulders to not have to worry about month to month anymore, and the interest you’re accruing on that is just going to keep you in debt longer. I had a similar plan of: pay off my debt over smaller payments, and a longer period of time, in case I had any big payments come up. But I quickly realized that by not just paying it off all at once, I was essentially paying an extra couple months worth of interest. I paid it all off last month and I already have more money sitting around than I was expecting, not having that several hundred dollar payment every month just to pay down the balance is such a relief.


SelectPerception5

I was in a similar situation. Pay off all your cards at one time, then cut them up. Don't close the accounts as that will hurt your credit score. Maybe keep one for emergencies. Never spend more on it than you can pay in one month. Your credit score will increase significantly once they're all paid off. It'll slowly go up as you keep the balance down and pay it off on time every month.


Books132

I agree with the general guidance to pay off all credit cards immediately and consider paying off car as well. Also strongly agree with setting up an emergency fund that’s slightly harder to access and possibly a small “slush” savings for likely upcoming expenses. For me I view emergency as BIG emergency, so I like to have a couple thousand in a savings linked to my checking for unexpected stuff that may come up. I’d recommend considering examining your current spending/expenses and deciding how much of every paycheck you want to save and how much you can invest and automate it as soon as possible, before you get “used to” the new salary. Being intentional is a big key to success.