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Every other debt gets its minimum. Every extra dollar goes here.
Tap an envelope to pick it and see its entries. A refund? Enter it as a negative amount, like -12.50.
Value per point = (cash price − fees) ÷ points. Around 1¢ or more is usually a decent use; well under 1¢ means paying cash is likely better.
Download your checking and credit card activity from January to today as CSV files from your bank's website, then import them. You'll get monthly spending by category, places to cut, and envelope budgets based on what you actually spend.
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Regular payments is the normal monthly payment on every other debt, added up. Paid to boss is everything going to the boss card that month: its own payment plus all the extra. When a debt is paid off, its old payment joins the boss payment, so that number keeps growing: that's the snowball. The plan finishes each boss card before starting the next one. A 401(k) loan repaid from a paycheck is counted too.
One-time money you expect, like a tax refund, a bonus or a business payout. It goes to the boss card in that month, and the plan shows how much sooner you finish.
Card companies usually only agree to settle for less than the balance when an account is already behind on payments. On a current account, the usual answer is no. Asking costs nothing, but don't stop paying to force a deal. That damages your credit and adds late fees and penalty interest.
If a company does forgive $600 or more, it usually sends a 1099-C. The forgiven amount can count as taxable income unless an exception applies, such as insolvency. Ask a tax preparer before agreeing.
A settled account is reported as "settled for less than the full balance," which hurts your credit more than "paid in full."
Get any settlement offer in writing before you send money, and pay only the exact amount in the letter.
The better use of the 401(k) loan is paying the highest-rate cards in full. Then call to ask whether they'll waive this month's interest or fees, since you're paying it off.
Another option: a nonprofit credit counseling agency (look for NFCC members at nfcc.org) can set up a debt management plan that often lowers card rates and combines payments into one. The cards usually get closed.
Based on a normal month. 401(k) loan payments come out before your pay hits the bank.
| If we… | Debt-free | Interest |
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