Quote:
Originally Posted by Fat Charlie
The only downside is that money in your .2% bank account is available for emergencies, and once you cut a check to pay off debt it's gone. A cushion of available cash is more important than being a smidgen less in debt because it makes it less likely that you'll slip farther into debt.
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...and the only downside to this is that you are paying more in the long run, as Xist points out in his example.
If you are paying down credit card debt by emptying your savings, the credit is still available in emergencies. By not using savings to pay down the credit card debt, you are perpetually paying for the "emergency" by loosing the money spent on the credit interest.