Ask Jean: Is Your House Eating You Out of House and Home? - Jean Chatzky - Making money make sense
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Ask Jean: Is Your House Eating You Out of House and Home?

iStock_000010136948XSmall I don’t know which way to go. Due to health. I been unemployed since 04′. I living on fixed income which most of it goes towards my mortgage. I had to file bankrupty in 05′. I re-established my credit only to get back in debt 2200 ( I shop when I feel depress and I try to control it.) Q. HOw do I know which cards to cancel or what do I do? Two of them have annual fees and 21% apr. The limits are 450 to 1500. Three I still need to pay off. My goal is to only have one card to pay by 1/11. I save all my change. Last year saved 388. So far this year I maybe have 200 I will used this to help pay down debt, but now have to replaced garage door (672) do I used my change or do I used saving (1501). Do this sound like a good starI have 401 k and ira which I know not to touch. Oh just to say that I have continue to pay more on my pricinple to get rid of the pmi. This month I will have paid my principle down to 78% then my mortgage will reduce by 30.
help – Reesiecup

In answer to your specific question, you should get rid of the credit cards with the highest interest rates and annual fees first. And of course, you know I believe shopping is not the right answer to dealing with your depression. But I want you to look at where you’re living. If most of the money you’re bringing in is going to your mortgage, that’s too much. Is it possible for you to reduce your cost of living by moving to a smaller or less expensive place? If not, is it possible for you to rent out a room to someone else? So many of us got into situations where we were spending way too much on housing during the bubble because we believed the values of our homes would continue to appreciate (wrong). Now you may be living in an unsustainable situation. Look to bring the cost of housing down below 40 percent of what you’re bringing in and you’ll be able to breathe.

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