So, I got $1,000 from my parents to help cover the vet costs. So, where's the question? Use the $1000 to pay the vet bill. But here's my conundrum...
(1) The vet bill is $1176.26 that is on a credit card that is only usable at the vet and is interest free for 3 months.
(2) I owe a total of about $5000 in state and federal taxes for 2008.
(3) There's only about $330 in my savings account.
So, what should I do?
(a) Pay the vet bill in full and have a net loss of $176.26 in my accounts.
(b) Use the money to pay part of my taxes right now, which would reduce fees and penalties that would be accrued over the rest of the year.
(c) Put the money in savings to gain a bit of interest until I eventually use it to pay the taxes at the end of the year.
I can kind of see the up-sides and down-sides to each option. Of course, no matter what option I pick, I need to tell my mother (when she asks) that the money did go to the vet bill. But she has no clue of my overall financial status. I think that right now, I'm leaning toward paying the state taxes with this money. The state tax has the lower amount owed, and with this money and what's in savings now, I could probably pay the whole thing in July. This would mean ZERO penalties and fees from the state of CT, but no payment to federal.
Hmm. I, of course, welcome opinions and additional options. I just deposited the check today, so I'm going to have to wait a few days anyway to make a final decision on this money. I just wish that things weren't so complicated right now.
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I'm going to answer this as if it were ME with the money, because while I don't know how your mind works, I know how mine does: I know it's super tempting not to, but pay off the vet bill. Definitely. The state/fed will not let you get around paying the owed taxes, they'll be on your case like crazy until it's paid. The vet credit, on the other hand? If it were me, I can GUARANTEE you I would let that slip completely out of my mind, maybe make a payment late, maybe miss one altogether, definitely not even consider paying it down until the interest started piling up, and then all of a sudden I've got ANOTHER minimum payment to deal with every month for the next 5 years. I made this kind of decision over and over and over with my own debt and its how I got stuck where I am - I'd say it's better, simpler, and smarter to just pay off the vet bill now. Besides, I'd way rather owe money to the government than to credit companies right now. They're not going out of their way to profit from your errors - they just want the money they're owed.
ReplyDeletePLUS, lying to your mom always kind of sucks.