tudorjason

Hypothetically, let's say I have nearly $4,500 on a credit card that has an interest rate of 3.99% for five years and I'm only in 1.5 years into it.

Would it be better to...

A: Pay $150 per month, definitely more than the minimum, have the balance paid in December, 2012, and pay $246 in interest?

B: Pay $150 per month until July, 2011, and then start paying off the balance with $375 per month until January, 2012 with $200 paid in interest?

C: Pay only $85 per month until March, 2013, which by then will leave a balance of about $2,000, but I would receive a refund by that amount and it off the rest in full, and paid $370 in interest?

Some pros and cons to consider:

Option A is stable; there's no games or changes I need to make to online bill pay. When I would receive the refund, I could invest it in CDs or something.

Option B would have the balance paid off the soonest and therefore less interest paid, but I'd be spending money I could save for emergencies. Again, I could invest the refund.

Option C would create the most interest to be paid, but I'd be able to save money for rainy days. No money to invest though except perhaps the money I'd save.

So, which option would be best for this situation and why?