Should I Use My SAVINGS to Pay Off Debt?
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My dad owed $5,400 on different cards and I figured he was paying $108 a month in interest. He had 12k sitting in the bank. I told him he should pay off all his bills, but he said he would not have the money in the bank. I told him he still has the money on the CC if he needs it. I showed him how much he was paying in interest and was just throwing that money away. He went the next day and moved $5,400 out of savings, put it in checking, and paid off all his debt.
Beautiful! â€ïž
Itâs the fear of not having any money in the âbankâ.
There are not enough people that know this. I learned this years ago from another CZcamsr that has grown since then. What I find funny is you have some with hundreds of thousands or millions of followers on things that don't benefit you in life whatsoever. Yet, something that most people struggle with, managing money, doesn't get that same attention. Funny how that works yet people always complain about it. They always feel like they are stuck. Thank you for showing people that there is a way. Maybe one of these day I can get the courage to help people in this space like you are doing. Keep it up.
SOOOOO TRUE! This is THE main reason I do what I do! Thank you for sharing!
Sounds like you have the heart for it. You should do it!
You have literally taught me how to totally transform our lives and for the first time ever KNOW that we will be able to retire in less than 5 years DEBT FREE! Very grateful to you!! â€ïž
*This should be taught in school from grades 6 to 12 and hopefully by graduation it will be so ingrained in the students brains that not many of those students ever goes into debt. Or at the very least understands how to use debt correctly and quickly get out of it!*
Exactly!! But instead, they want to teach kids the woke theory and how to change their gender without telling the parentsđĄ
I agree, but it never will be since they want us as slaves
đ this video really woke me up, I have a nice savings account in the bank and a nice checking account but I was in a lot of credit card debt, I took 5k of my checking and got some credit cards paid off, I'm still in a lot of credit card debt but I'm paying that down fast, I stopped building up my bank account and now all my money goes towards paying these credit cards thank you again for guiding me in the right direction
I have been studying your videos and just applied velocity banking to my life! Thank you for your wisdom and demonstrations of financial literacy.
Hi Christy. I must tell you how much you've helped me just from watching your videos and especially this one. For years, I've been transferring money into my savings account first and then paying everything else. This came from the mainstream recommended strategy to pay yourself first, then the bills. I was always so hesitant to use my 20k savings on credit card debt even though it was enough to cover most of it. But your videos have made me realize this is the best option. I just paid down my two highest balance credit cards and the third one I will pay off in about 1 or 2 months and I can restart my savings right away. I already moved every expense possible to this remaining card. This is a major game changer for me. I will be debt free in a couple of months. The strategy you are teaching is amazing and I'm sharing it with others. God Bless you, your family, and everyone who benefits from your teaching.
Holy smoke! I actually never thought about this! I'm going to pay off a credit card off at the end of this week merely by thinking different! THANK YOU!!!
Thank you soooo much for this vĂdeo, that was exactly my question. I canât believe Iâve been having this savings account in the same bank I have a CC that is charging me 31% interest! đł. Just for the sake of knowing I have money sitting there in case of an emergency, I am not dumb because I start looking for a solution to my debt when I found your videos. I want to change my mind, Iâm going to do what I just learned and Iâll tell you all about it!
đđŒđđŒ
On my own defense I have to say that, being a very poor child and working sooo hard to earn my money, itâs VERY hard to let go of savings, I promise, VERY HARD đ©
This needs to be taught in schools, great video.
AMEN! I donât see that happening though. Lol! Thanks for watching.
Yes it does but we all know why they don't. More money for them lol.
finances will never be taught in school because it would free debt slaves. Nice to dream, but it will never happen
I only wish I'd heard this 35 years ago...
Ditto
â@@VanntasticFinances What about using a 401k to pay debt?
I love learning how to change my thinking! Knowledge is power. Thank you for these videos!đ
Like your mantra ''I make suggestions, you make the decisions".
You are such a blessing. Thank you so much. I needed to hear this. God bless you!
God bless you sis, and thank you for sharing your wisdom. Amen! â€
Thank you. I needed to hear this.
You just gave me an idea. Thank you!
I hope it was a good one! đ
You are awsome! I am following your lead! I have started my journey and paid off 5,750 of debt in one month! Its crazy how this is working. I have over 50,000 of credit in lines of credit because I also do real estate investing. I took my penfed LOC and made it personal and started your system. I am going to continue to use that same 10k in my personal life to roll off debt off! Thank you for these videos! Thank you!
Thatâs absolutely awesome! Thank you for sharing! I shared your comment in an upcoming video!â€ïž
This makes so much sense!!!
Great advice!!!
I have just started watching your videos recently, and this was an eye-opener. When one approaches money emotionally, they tend to make decisions that don't make sense. I am in a similar situation as you have demonstrated and plan to march down to my CU tomorrow and discuss closing out my CD early and make sure I will only lose the interest - I will make up for the credit card interest savings in one month! I had a lot of financial hits in the last two years, including moving halfway across the US twice, so was hanging on to my savings for....emotional support?
I love your straightforward and common sense advice. Thank you for sharing so much of your real life knowledge and experience with us!
Thank you Christy Vann. Your amazing
Youâre amazing!
outstanding video- thank you!
I really needed to hear this, I appreciate this! I told myself I would use my savings to pay off my debt but I wanted to do some research on it. sounded like I smart idea but then the thought of not having the money in my savings and it brought fear. living in the lack. I will be using my savings to pay down my debt and then I can start saving the money im using to pay down the debt, to save. you are amazing.
Thank you so much for your eye opening information. This has made a world of difference to me. I'm a subscriber and will continue to tune in and support in any way I can. Again, thank you.
I am SO glad you now see the differences in banking!! Thank you for your kind words! Sharing videos is always helpful to get the word out. Thank you for watching!
Knowledge is power! Fire the bank.
Keep up the good work đ
Thank you!
Thank you!
Adjusted my thinkingâ€
Wow. Eye opening.
Thank you!!!!
Very helpful. Thanks!
Thank you for watching
I WILL FIRE THE BANK THANK U CRISTYâ€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€LOVE YOU'RE VIDEOS
Helpfull, thanks.
great video
Glad you enjoyed it
I love when doing math, exercises the logic at 100%. Thank you!
Beautiful eyed woman †thank you for sharing this gold with the world!
Amen đđŸ
Great videođ„đ„ it makes so much sense. Like duh common sense right. Thank you
Glad it was helpful!
funny that not only is that pathetic savings account is being eaten into by debt interest but also losing tons of value due to inflation at 8-10% also vs the maybe 1% savings interest. Its such a sad state of affairs we live in today that people cant see the debt money we live with. Ive really enjoyed watching your videos after surfing in randomly today.
She gave it to us no filter đ„
Thank you so much for your suggestions. Full transparency that was me having money saved and still paying a car loan. But as of today I transferred all my money to make a payment with all my savings. Thank you. I will continue to learn more. How do we tackle the mortgage? Should I take out a personal loan or use credit card? Thank you. God bless you.
â€â€â€ it all makes senseâŠ
What's scary is Dave R teaches the same but to tear up the credit cards , what would you do then in an emergency?đ€
You save up an emergency fund, the use that when something bad happens. Itâs pretty simple.
What you are doing to help people is treat
Did you spot the mistake?
$4000K = $4,000,000.
I won.
We won with her good advice video!
I don't have debt, but I'll never think of credit cards the same as I did.
I am at the beginning of my Velocity Banking lifestyle change. I gotta say it is frustrating right now because my credit score sucks and I can't a HELOC. Plus the card with a $10,000 limit, keeps lowering the limit as I pay it off. It is now a $6000.00 limit card. I am about to go under $5,000.00 so I expect it to drop to a $5000.00 limit. I was planning on using this card as my LOC. But now I am not sure what to do.
Good morning! Is the financial worksheet still available? Thank you for making velocity banking videos.
Wow tks. So much for open my eyes!!!! Can you make a video about to take a hemloc loan is good or not ? That's in advance for all ur teaching !!!
Great information! I've seen this before on CZcams but it did not have as much info and examples. Thanks. Do you have a spreadsheet that we can use?
Awsome video. When you say send my income to the credit card i am assuming you depositing you monthy income from checking to the credit card dont matter what the balance is ?
I enjoy your and Denzel videos. I keep missing how you calculate the interest as I get to know my numbers. Could you direct me?
Christy,, two things. First I want to thank you for helping me. I've been learning your strategies and starting to apply them with my highest credit card. I don't have the credit score for a HELOC yet even though I have 400k in equity. I will use your sketchies with my highest credit card payment. As I continue to do that I need credit card it will raise my score and I will get a HELOC to use to pay off my mortgage fast.
Second, I see that lately some of the credit bureaus are reducing your credit limit as you paid on your card and I have a question for bring down the principal a little each month. That way all your credit card minimums are used to pay down your balances and the credit card companies don't see a big drop in your available limits which might be more likely to trigger a credit limit decrease by them. Mostly though I like seeing all my credit card minimum payments converted to hang down my balances every month. For me that would be about $600 per month of cash flow instead of minimum payments.
Love your channel and your enthusiasm! You are a great inspiration to so many especially during these difficult times. I recommend you to friends and family all the time.
Mine set
Exactly!
Mind
Are you suggesting to put extra money into paid off LOC instead of a savings account? If so, what does that do? How does it help?
I have 115k on house mortgage at 4.25% with 85k in bank earning 5% Iâm paying extra 2k month plus 1k principal should have home paid off by next summer.The 85k is part of emergency fund how would you play this out?
So, the million dollar question...... Once i get my credit cards paid off, what's the quickest way to put savings away? I need to buy a car, but I also need to buy a house.
Im going through a messy divorce, and i want to be completely financially independent.
đ
thank you you open my eyes, what I can do with my savings if I don't have debt?? where to invest?
Open that ROTH IRA friend
Hi Christy :) What would you recommend prioritizing if youâre trying to save up to buy a house, but also have credit card debt, student loan debt, and a car loan? Would it be better to use velocity to pay down the debt first? Or work on saving? Our cash flow is about $1000-1300 a month.
I've been burned too many times doing that. Pay off a LOC with savings, then the LOC gets cancelled and I have no cash. Yes, it is a losing proposition financially, but LOCs are not guaranteed. They can pull the rug at any time. Bank accounts are not 100% safe either. I pay myself 1st. The numbers you present are correct. But you are walking on thin ice trusting in an LOC that can get yanked at any moment. I use the velocity system using 90% of my income.
That works too especially if you understand the system. I think this information is invaluable especially to those who are drowning in debt
If you put an automatic payment, like a car insurance or cable bill, on that card every month, the bank sees that. Very unlikely they will cancel the card.
Sometimes when you pay off a credit card, they cancel the credit card.
Seldom. Keep them active with monthly utility fees.
Or...they'll just drop the limit to almost nothing.
We have a savings in the bank. But I'm going to start paying off our car loan instead of putting more money into savings
So recently I just got told I need a new roof thanks to the insurance company. So it was better to be getting a line of credit to pay for it then refinance for the home...?
absolutely!
sent you a email with spread sheet about a month ago hope to hear from you soon
Iâm sorryâŠwhat date was your service scheduled on?
Here is the thing though, if you do this and then you lose your income (an emergency) , wouldn't using the credit card put you right back at square one ?
I do owe about 10,000 on my car and have about 5500 in savings to use as payoff with no credit card debt. The problem is that is all I have saved and no cards to fall back on in case of an emergency I love this idea just worried about the time when an emergency comes along any ideas? Open to any suggestions
One time I heard that a savings account gives you points when you are applying for a home loan. Is that true these days?
I donât like unloading nearly all of my savings to pay off a debt. Because I did that with my wifeâs credit card after we got married. My ~$20k in savings to pay off her $13k along with a $10k wedding depleted my savings and money has been tight for 2 years up until now. I have now rebuilt my savings to $9k. Iâm sleeping better. With a goal of $10k by Christmas. Once I have more than $10k. Then Iâll put the extra towards debt. Because I need a new washer and other odds and ends. If I cleared my savings to pay off debt. I will leave myself vulnerable for when the next major expense strikes. I pay on credit and now am paying high interest payments all over again. Because when it rains, it pours. So the credit card can be a slippery slope to creating new debt. Iâm willing to dig into my $10k to make an aggressive debt payment for the hopeful return of money saved. But I donât like clearing the account or nearly clearing the account.
Are we still live
Wait is this actually new video or VHS tape?
How to pay your home off
And then negotiate a lower interest rate on that CC. Tell them you paid it off and want to close it and they will negotiate!
@paulcutlassclassr it doesnât matter what the interest rate is if youâre using the credit card correctly. Especially if youâre paying it off before the due date.
Absolutely!
Whatâs the best way to buy a car?
Line of credit
Thatâs your answer for everything?
How about a Cheap car loan at 5-7% instead of a LOC at 15%+?
You can always pay more than the payment every month to get it gone quickly. And youâd be charged much less interest while you do it
Makes a lot of sense. My only question, coming from a near financially illiterate individual, is... after the CC #1 is paid, she mentions bringing the car loan at 2.5% over to CC #1 with 21% interest. I dont understand why that would be beneficial.
Watching more videos will help you understand how LOANS are totally different than LINES. Different interest..
@@VanntasticFinances Thank you!
@@dhanus010 Interest is NOT different on a line vs a loan. She doesnât understand interest rates (Iâm a CFP with a degree in finance). If you have a $1000 balance at 10% on either that is $100/year. ($100 / $1000 = 10%) Thatâs literally how the math works.
Interest rates are designed to help you understand the cost of that option. Thatâs the reason they exist.
Your instinct was rightâŠ. Donât voluntarily move from 2.5% to 21% unless you just like giving more of your money away. By moving your 2.5% car loan to 21% you would pay close to 10x the amount of interest.
She seems to think that the only way to pay more than your monthly payment is a CC or a LOC. That just isnât true.
@@dhanus010 I wouldn't listen to jpg7616. Her other videos explain that you can use a line as a checking account and it wipes out the debt very fast, versus a loan that you just slowly pay off. The loan has a lower interest rate but you end up paying on it 4x longer and so end up paying more interest overall.
Hello
What will be the smart and best options
If you have by example
100k on savings
And you own 80 k on your mortgage
I should pay all the mortgage and not to have any savings on the side just for maybe invest in something?
It depends on the remaining interest on your mortgage, or whether return on investment will beat the interest paid. Either way, if I were in your shoes, I would look to invest that savings so it's making more money.
How do you pay off your car with a credit card or am I missing something
Watch it again. And again. Until you thoroughly understand it. It will eventually happen. Just be patient with yourself
Yes! Thatâs exactly how I did it! Iâm kind of a slow learner though đ„Ž. But I NEVER give up! That compensates for it đ
Canât work old and sick
Y is that account 14000....
What if there is no money for savings not enough money to pay all the bills talk about it please
Spend less or do something to make more.
Finance isnât magic. If you are spending more than you make, no debt strategy will fix that.
What about life happen. Your car needs new tires. Sally needs a new uniform and new shoes. The refrigerator breaks., Husband looses his job. You loose your job. The Hot Water Heater breaks. Where is all this money going to come from. O I get it I can charge again on the credit card and life goes on.
Why do you think that she is 24,000 in debt on credit cards to begin with.
She would then have $600 to put into her emergency fund PLUS that $85 she was putting in every month: $7,200 yr PLUS a 14k avail if emergencies goes over $7,200. Haters gonna hate.
@@Ingrid_Abrams Correct
You sleep better at night trust me just get rid of it
Do people really not know this????
once credit cards are paid down, would the thing to do after be taking like a $10,000 advance on the credit card and dumping that on the mortgage, then start paying down the cc again?
No, a cash advance on a credit card will be close to 30% interest, leave it paid down .
Get a fixed rate Heloc then pay the mortgage a lump sum 10k using the debit card they provide for the Heloc, then deposit some of your income monthly on the Heloc account to pay it down. After it is pay off, keep the Heloc open in case of emergencies.
No. Absolutely not. Thatâs a horrible idea.
If youâre currently paying 3.5% interest on that $10k⊠why on earth would you want to instead pay 21%??
Thatâs all you would do is switch from 3.5% to the higher rate.
A CC is not the only debt that allows you to pay more. If you have extra income, just pay more on your mortgage if you want it gone
WHAT did you charge on your cards? Is it gone? Haha
$1,200 a month for utilities and food,this must have been way before Bidenomics!
Should I do velocity banking to pay off my mortgage? I donât have a car payment, or very much credit debt but I put lots of $ into savings like my rrsp and tfsa. Gas/hydro/internet and cell phone cost me $500 a month I top of my $1200 mortgage payment. I make $100,000 a year
It sounds like you could easily use velocity to pay off your mortgage. You may want to stop your savings deposits and begin infinite banking FIRST then work on paying off mortgage. That way you can be drawing interest while using same funds to payoff mortgage. Does that make sense?
RRSP and TFSA are not regular savings. She may not know (why would she?) Canadian things. RRSP is like a 401k. TFSA is a tax free saving account