The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: wealthviahealth on November 24, 2014, 03:50:48 AM
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With several big travels coming up and with all of the extra purchases that come along with the holidays, I will be slightly short on cashflow to cover some upcoming bills.
I have an adequate emergency fund and channel most all of my savings into stocks and I rarely dip into either of these unless I absolutely have to for motivational reasons.
If i put these charges on my CC instead of cashflowing them, the total damage in interest would be around $5-8. I hate the idea of getting charged interest at all but I think that I dislike the idea of dipping into my EF or stocks even worse. It feels like progress lost when I do and will often take me a bit longer to "payback" my EF as opposed to a CC where there is much stronger incentive to pay it off quicker.
Does any one else have this mental barrier? What are your thoughts?
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Um - I am going to be unpopular, but if you can't CF your trip, maybe you shouldn't take it. However, I would probably never worry about $5-8.....not worth my effort.
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Neither. Time to cut back on your holiday spending.
That said, if you refuse to do that, then I thin the EF is the way to go. Paying interest when you have money in the bank is silly.
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I say use the EF. The whole purpose of the EF is unusual expenses. You don't want to start a habit of carrying a balance on your CC even if it only for the short term.
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Well, first choice is to skip the trip. But if that's not in the cards then I would use CC because this is not an "emergency". Since you're mentioning such a small amount of interest you would pay, I assume that you could pay it off in one extra cycle. Live and learn.
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No, don't pay interest.
Going forward, maybe you need a "buffer account" for uneven expenses or a travel account.
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No, don't pay interest.
Going forward, maybe you need a "buffer account" for uneven expenses or a travel account.
I like this idea, thank you for the suggestion.
Since most of my cash goes into stocks or my ef, Im usually not sitting on much discretionary spending money but a buffer account that holds $250-500 could be just what I need. Using this wouldn't feel like a failure as I wouldn't count in in my net worth totals the way I do the rest of my accounts.