you should pay the card down but not in one lot, pay half now and then half later, its better for the credit file, keep the card and use for minimal stuff, do not forget to use it but stay under 500$, get a hold of your credit file and get a lower APR card, there are a few out there and use them the same

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but why not just pay it all off as soon as you can. wont that just save you money in the long run

sure, but you can not maximize the result on your credit file

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From your balance and minimum payment, I am estimating that you are paying a rate of around 10% on your credit card. Based on that, assuming that you make a $95 payment every month until it is paid in full, it will take you around 77 months and cost you a total of $7315. Assuming you keep that $5400 in the bank and put it into a CD for 2.75%, that money you held on to will be worth about $6450 in that same 77 months.
Now what if you pay the card off now? That would mean you have $95 a month that you can put into savings. Since you can’t make monthly deposits into a CD, let’s assume you are only getting about 1% on your deposits (There are online savings banks that are FDIC insured, such as INGDirect that are paying 1.4% right now). In 77 months, that $95 a month will have grown into around $7500. Just by stuffing the money under your mattress and earning no interest you will have $7315. It seems like for your scenario, paying the account in full and then saving the difference will put you ahead.

The advantage could be if your rate on the credit card is much lower or the amount you earn on interest in savings is much higher. Keep in mind, however, that you could be improving your credit score by eliminating the balance from your card. One thing you do NOT want to do is to close the account once it is paid off. That could actually lower your score for a while. Just use it now and then and pay it in full right away to keep it active.

If your savings is not generating any income then I would pay off the credit card in one go, then at least you're not paying anything out on a monthly basis. Then I would take that 90-95 dollars a month and add it to whatever else you can afford from your monthly income and put it back into your savings.

I only have a credit card for emergencies, I don't think they should be used for large purchases or daily living expenses because they just sap your money.

If you fully understand the implications of what you are doing and are able to access new borrowing at a low rate of interest, debt consolidation can be an effective approach to a debt problem. Alongside this you need to aim to bring your budget back under control, pay back any future credit card spending in full each month without fail and start saving for future unexpected or irregular costs.


However, be very careful, consolidating often lead to worsening debt. The reduction in monthly payments often comes at a heavy price.


Most of all you have to consider how much of your lifestyle you're willing to sacrifice to gain a bit more financial freedom.

But sometimes consolidation can be the only choice, better that than not be able to afford your repayments.

What did you have the $10k sitting in your savings for in the first place? You haven't given your income or expenses so it may be hard to judge. If you don't have a separate emergency fund then I would recommend using that $10k as your emergency fund (or part of the $10k depending on your income).

As long as you are throwing some money on it then you will be well in control, so I wouldn't worry about it!

You should consider paying it off even if you have a relatively low interest rat of 12 or 13% you are still paying more than 600 a year in interest. Though it is important to have a cash reserve, but by paying it off that extra $90 amonth can be redirected to savings to rebuild your cash reserves

Depends on 2 things:

What's your goal for that $10,000 is it your emergency money, a possible retirement fund....etc.

What's your reason for wanting to pay off the credit card do you just want to get rid of the payment, or were you looking to free up a larger line of credit?

I would pay it half off and then continue to pay it off in payments that way i get some of it off my chest and still have some money left over in my savings.