As I mentioned before, I will get $400 from my new roommate. I’m so excited to have this extra money and trying to plan ahead. But I thought I’d pose a question to that fabulous PF blogging community out there:
What should I do with the $400?
a. Put it all on my debt.
b. Put it all into my wedding savings.
c. Split it down the middle: $200 to wedding, $200 to debt
d. Start a Roth IRA with it.
e. Start a travel fund.
f. Use half to buy J a nice present for his b-day and the rest to debt/savings.
Tell me what you think!
I would throw $350 at the debt and spend the $50 on doing something nice for J. Maybe a romantic picnic lunch and a little something? You don’t have to spend a lot to figure out a meaningful gift. :)
I would personally split it even more. I would use $50 for J. and then put $200 towards your debt and $200 towards your wedding fun. I mostly say this because it feels really good to save up money too instead of just paying down debt. It might motivate you more. However, if your parents are charging you interest, it does make more financial sense to put it toward the debt.
Of the things on your list, I’d go with paying it all towards the debt. According to your sidebars, that would put you within $50 of paying off the first $1000 of the debt to your parents. I think the psychological value of being at $950 would be huge.
I would probably put it in the wedding fund. You are going to need the money for the wedding and putting it towards the debt just increases the likelyhood that you will need to take on debt to finance the wedding. Of course this depends on the amount of time you have before the wedding but that is probably where I would stick it.
I am always a fan of splitting.
50% debt, 25% wedding, 25% Roth IRA
You get to
a) pay down debt with 50%
b) save! (25% wedding, 25% retirement)
I think I would put $300 towards debt and split up the rest. Let us know what you decide!