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Dont Save When You Are in Debt.
 Humans are curious animals. We don't always do whats best for us - instead, we do what feels best, and try to blot out any reasons why it might not be the most effective thing to do. Possibly that's why there are so many people who have both savings and debts.
Its an Issue of Psychology.
Sure, it feels better to have savings. Saving feels like you're constructing a base for your future, while paying off your debts feels like you're giving your money in to a hole. That money is for the kids future, or for improving your house, or whatever else - and it's in an bank account realizing a valuable rate of interest. What could be wrong with that? Lots, if you have debts.
Dont Be Fooled.
There are almost no savings companies that will let you have interest rates as high as the ones credit cards wrest from you. Heres a question: if you have $10,000 in a savings account earning 5% a year and $5,000 on a credit card at an interest rate of 20% per year, how much cash do you have? After just five years, the answer is effectively nothing - your debt would have grown to as much as $12,500, the equal total that your savings are currently worth.
You might not believe it now, but it truly is a great deal better to pay off your owings. If you used half your savings to pay off that debt, youd be in such a better spot that it's really astounding. You avert five years of compound interest on the debt, but you still get to hang on to $5,000 in your savings account, earning interest - after five years, that's more or less $6,380.
If youd still rather keep your savings intact instead of using them to pay off your debts, ask yourself this simple question: is your pride worth $6,380 of your familys hard cash?
Think of Your Financial Well-being.
Once you get enough money to pay off your debt, theres absolutely no logical reason to keep it. Debt is for people who don't have the money, and have to borrow it. Debt costs money, and savings make money - you need as much of your financial resources as possible to be savings, not debts. If your savings account and credit card are with the same bank, then youre effectively paying for the privilege of borrowing your own money from them. Why on earth would you do that?
There are additional benefit's to getting rid your debt using your own money. Youll be less strained about your debts, and your credit statement will show that you were able to pay everything back - resulting in getting you a much smaller interest rate if you should need to go into debt in the future.
I know it's hard. You just have to be mindful that any cash you've saved hasnt actually been saved at all. Its money you ought to have been spending instead of buying things with a credit card. Yes, it feels much worse to spend money thinking that youre spending away your nest egg - but always remember that when you use a credit card to spend that same amount of money, youre spending away your future, plus interest. Anyway, if you've got the debt, then that cash in the bank has already been spent - stop denying it to yourself.
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