Credit Card Transfer

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
Mastied
Posts: 11
Joined: Mon May 27, 2019 7:56 am

Credit Card Transfer

Post by Mastied » Thu Nov 07, 2019 6:46 pm

This question concerns a young adult. They built up around 8k in credit card debt (lecturing did no good). Would it be worthwhile to find another card with a better rate, and do a balance transfer? If so, what would be a good card with fair credit, and moderate income. Or would it be better to take out a consumer loan? It's a terrible situation for a young adult, I just don't know what would be best. I know that by doing a balance transfer to another card, doesn't mean they won't start to charge on that card and build up more debt, it can become a never ending cycle. Any advice is great

Silk McCue
Posts: 3307
Joined: Thu Feb 25, 2016 7:11 pm

Re: Credit Card Transfer

Post by Silk McCue » Thu Nov 07, 2019 7:40 pm

Regardless of how the $8k is managed they should only have access to a debit card, not a credit card going forward until the card is paid off. If not they won’t learn.

They need to maintain full responsibility for the debt and experience the burden of cutting back on expenses to climb out of the debt. As Dave Ramsey says “Rice and Beans”. They would probably benefit from Dave Ramsey’s teachings.

Sorry that they got themselves in this situation. They need to come out on the other side without being bailed out.

Cheers

User avatar
Nate79
Posts: 5107
Joined: Thu Aug 11, 2016 6:24 pm
Location: Delaware

Re: Credit Card Transfer

Post by Nate79 » Thu Nov 07, 2019 10:10 pm

It does no good unless they have a plan to get out and stay out of debt.

User avatar
whodidntante
Posts: 6558
Joined: Thu Jan 21, 2016 11:11 pm
Location: outside the echo chamber

Re: Credit Card Transfer

Post by whodidntante » Thu Nov 07, 2019 11:05 pm

Is it a problem managing credit or a problem with insufficient income? The solution should depend on the answer to that question. I'm going to guess insufficient income since 8k represents a problem.

1130Super
Posts: 22
Joined: Thu Nov 07, 2019 8:59 am
Location: Minnesota

Re: Credit Card Transfer

Post by 1130Super » Fri Nov 08, 2019 5:04 am

paying normal rates on CC is one of the worst financial moves someone can make. I would make sure when opening a new card the other card gets closed after the transfer. Gives 12-15 months to pay off as much of that CC as possible .

Topic Author
Mastied
Posts: 11
Joined: Mon May 27, 2019 7:56 am

Re: Credit Card Transfer

Post by Mastied » Fri Nov 08, 2019 7:55 pm

She is not real young, she is 28. She doesn't live near me, so I don't have day to day contact. She probably makes around 35k a year, lives in Houston, shares an apartment, so those costs are split. She has a car payment and insurance, It's not a fancy car by any means, she's on my cell plan, and half the time I make the monthly payment, even though she's suppose to send it to me. It's a matter of a young person wanting to have fun and not really having the money to do it. As grown adults we knew that credit card debt can sink you, you'll feel that you will never get out of it, so you just keep spending more. Even though I'm the parent, I don't feel it will do much good to bail her out, sometimes life teaches you hard lessons.

User avatar
RickBoglehead
Posts: 4558
Joined: Wed Feb 14, 2018 9:10 am
Location: In a house

Re: Credit Card Transfer

Post by RickBoglehead » Fri Nov 08, 2019 8:02 pm

Time to cut the cord.

She is apparently not responsible, but you cannot fix that. Stop enabling.

IMO.
Avid user of forums on variety of interests-financial, home brewing, F-150, PHEV, home repair, etc. Enjoy learning & passing on knowledge. It's PRINCIPAL, not PRINCIPLE. I ADVISE you to seek ADVICE.

User avatar
whodidntante
Posts: 6558
Joined: Thu Jan 21, 2016 11:11 pm
Location: outside the echo chamber

Re: Credit Card Transfer

Post by whodidntante » Fri Nov 08, 2019 8:12 pm

Mastied wrote:
Fri Nov 08, 2019 7:55 pm
She probably makes around 35k a year, lives in Houston . . .
I think she's got an income problem. I guess you can live in Houston and have a car for less, but it's not going to be a whole lot of fun. If I woke up in that situation, I would plan to make a strategy to earn more money.

RetiredCSProf
Posts: 289
Joined: Tue Feb 28, 2017 4:59 pm

Re: Credit Card Transfer

Post by RetiredCSProf » Sat Nov 09, 2019 8:48 pm

My Dad bailed me out of credit card debt when I was about 25 years old. My embarrassment in having to ask him for help was enough of a lesson for me to never ask him for help again. He paid off each card (10-15 cards) and paid two months of car payments.

He gave me conditions for the bail out:
  • I tore up all the existing cards
  • I did not open any more credit cards (until several years later)
  • I sublet my apartment and moved to a less expensive apartment
  • I took overtime work at my job and sent the extra money to my parents each month
My husband's spontaneity was a significant factor in our getting into debt. I was the primary earner. My husband did not go with me when I went to visit my parents in person and ask for the loan. When I filed for divorce, the following year, my parents gave me back the money I had repaid them for the loan.

Katietsu
Posts: 2434
Joined: Sun Sep 22, 2013 1:48 am

Re: Credit Card Transfer

Post by Katietsu » Sat Nov 09, 2019 9:34 pm

I helped a relative obtain a 7% loan to pay off credit card debt at 16%. Worked out.

The real question is whether or not she is prepared to make changes going forward. If she is willing to come up with a budget and plan to pay off the debt, I might be willing to match part of her payments or gift the last couple thousand. If I did so, I would make clear that it would be a one time thing.

Post Reply