A few weeks ago, financial guru Suze Orman was a guest on the Oprah Winfrey Show. She was sharing her 2009 action plan. I personally am not a huge fan of Suze’s but I do think she has some good points. One point in the show yesterday Suze made the point “Pay off credit card debt BEFORE creating a savings account.” This brought up several questions in my mind.
- If you follow this guideline, what happens if you have an emergency? One would have to incur more debt thus putting you in worse position.
- What if you have a child nearing college? Should you try and save some for him/her?
- Wouldn’t saving, even a little, add some sense of security and sustain your momentum for paying off debt?
What are your thoughts? Do you save some before paying off credit cards?