Consolidating Debt and Managing Investments: Navigating Financial Bad Choices

welcomeUniverseWorld on 15/04/2024 - 14:16
Last edited 10/05/2024 - 21:30

I made a significant mistake by taking a cash advance from my credit card and investing it in leveraged Bitcoin trading. Initially, I saw substantial profits and was only paying the minimum monthly credit card amount. Then, I invested in a rapidly rising memecoin, which resulted in substantial losses. I now have approximately $15,000 remaining in BTC but I am in debt of $33,000. In net I am down by 18K in debt.

Currently, I am considering consolidating this debt onto another credit card with a zero-interest rate to facilitate quicker repayment while continuing to hold Bitcoin.

I see two options: either I can pay $15,000 towards the $33,000 debt and transfer the remainder to a zero-interest credit card, or I can transfer the entire $33,000 to a zero-interest credit card(s) and retain the $15,000 in Bitcoin. I am leaning towards the latter option, though I still have some reservations.

Today, I applied for a zero-interest balance transfer card and was instantly approved for a $10,000 NAB card with a 28-month term. This means I need to find a way to manage the remaining $23,000. I am exploring which credit cards might be better suited for this situation. Any suggestions?

Update:

I did some overtime that was used to pay off a significant portion of the debt.
I moved part of the debt to a new credit card with 0% interest for 28 months. I plan to pay that off in 28 months.
I have like 8.5K remaining in high-interest credit card that I am trying to move to some credit card with 0% interest. I will search and probably apply for one next week.
This way I hope to be debt free in 28 months.
I have not cashed out the $15K of BTC. It stays as it is.

Financial

Comments

  • Jake D on 15/04/2024 - 14:27
    +19

    Manage the remaining 23k by selling down all your holdings. Then paying off the $8k from your paycheck as fast as you possibly can.

    When you're done with that, cancel and cut up the card. Then pay down the balance transfer ASAP. Then cancel and cut up that card.

    Then save up. Then invest cash you can afford to lose in something much safer.

    • djkelly69 on 15/04/2024 - 14:59
      +2

      Agree with all of this.

      While you might be hoping BTC goes up more, it is really just a guess at this point (much more so than with say shares or real estate). Factors such as the looming US election, Russian war, middle east war, etc, could all have an unknown effect on the price.

      Also, assuming you have a capital loss at tax time, remember this can be carried forward indefinitely to offset any future capital gains.

      • welcomeUniverseWorld on 29/11/2024 - 23:43

        Thanks. I moved all the debt to zero percent interest credit cards. I been paying it off with higher payments and will try my best to pay before end of the term. On other hand, i have kept the BTC hodling. It is a hard life

  • jv on 15/04/2024 - 14:36
    +11

    leveraged Bitcoin trading.

    😲

  • overthinking on 15/04/2024 - 14:40
    +9

    Then, I invested in a rapidly rising memecoin

    we call that gambling

    imo talk to a professional and not ozbargain… imo you just cash out your btc/investments and get out of debt asap

    • jv on 15/04/2024 - 14:41
      +3

      talk to a professional and not ozbargain…

      You are the anti-Gerry !!!

  • ThithLord on 15/04/2024 - 14:43
    +16

    Rektrading, is that you?

    • Lurk Hartog on 16/04/2024 - 08:14
      +1

      🎯 🔫

      Or something…

    • bobbified on 16/04/2024 - 14:55

      For that guy, add a few more zeros at the end of those figures. lol

  • freefall101 on 15/04/2024 - 14:50
    +10

    Ask yourself, are you holding onto bitcoin because you believe it's a sound financial decision with clear data about how it can grow in value, or because you want that good feeling rush when the value spikes again and it'll solve all your problems like a tattslotto ticket win?

    Reduce your debt to zero as quickly as possible and start again with stable investments is the smart decision. If you can get $33k of zero interest credit cards sell the bitcoin then stick the cash in your offset account/high interest account. If you can't, sell the bitcoin then pay off as much debt as you can to avoid interest.

    At no point should holding onto bitcoin be a common sense answer in your position. Because that's how you'll wind up 33k in debt.

  • Ghost47 on 15/04/2024 - 14:54
    +4

    Leverage should only be used on surefire bets, like property.

    • KangaDrew on 15/04/2024 - 16:54
      +3

      Leverage should also only be used by experienced traders. Anyone using a credit card to pay for Bitcoin clearly hasn't conducted a shred of DD. There's newbies and then there's ignorance.

  • try2bhelpful on 15/04/2024 - 15:11
    +3

    Get yourself out of debt ASAP. The interest rates on credit cards are nuts. The bitcoin might go up or might go down but you, certainly, know you are paying high interest rates now. If you are playing this game you take your wins early because the fall is coming.

    Bitcoin makes me shudder and I have a reasonable number of shares.

    • boomramada on 15/04/2024 - 15:31
      +2

      And fill the gap with a personal loan.

  • KaTst3R on 15/04/2024 - 15:50
    +2

    Sounds like a case study for everyone. Dont gamble on CC cash advance.

    • Crow K on 15/04/2024 - 16:29
      +3

      sniping particular setups, scalping things such as shorting a bullish 3 drive pattern on pump&dump coins

      This Wolf of Wall Street word salad is exactly the sort of thing finfluencers spit out while circling peaks and troughs on charts in their little videos

      This is a symptom, disguising itself as a cure

        • Crow K on 15/04/2024 - 17:16
          +1

          Finfluencers who need to keep making analysis vids and content to stay present in the algorithm and get eyeballs on screen are the ones saying things like "okay guys we are just sticking with Bitcoin and we have a long steady buy and hold strategy"? Really?

          I think you can cook up something a little more plausible than that. Consult your charts and give it another go.

          • BoltThrower on 15/04/2024 - 17:24

            @Crow K: Most of these influences ARE rubbish, playing it safe or getting people to pump their bags on meme-coins before they dump. If you can find one who advised to sell at the top of a parabolic rise, after liquidating short-sellers, please let me know…because nearly all of them are too afraid of being wrong and just hold in case it does go to the moon.

            • Crow K on 15/04/2024 - 17:29

              @BoltThrower: I'm glad that you agreed with me in the end (though I'm disappointed you deleted two entire posts full of "mummy I'm charting" buzzwords and frankly incorrect takes in the meantime).

              Still, there was that small bit I quoted.. obviously I'll just need to quote more extensively next time ;)

              • BoltThrower on 15/04/2024 - 18:40

                @Crow K: It was never a matter of agreeing with you in the end.
                I talked technical analysis, which seems to have rubbed you up the wrong way and it reminded you of something similar. You made an incorrect connection. On the surface it made sense why you'd equate the two, so I deleted the comment before others dog-pile.
                Me advising against leverage for newbies, the temptations for leverage because some people CAN and DO do it, was not an incorrect take.
                The advice to resist FOMO (Fear of missing out) which is encouraged by influencers, especially to pump their meme-coins before they dump, was not an incorrect take.
                You actually summarized the average 45min Youtube video. "Keep holding and we'll be fine. BTC went from 19k to 3k. These drops are expected and a good thing. We can buy the dip etc etc" That ain't cooking anything up, but a balsamic reductio ad absurdum
                There are some who do chart, but they tend to talk about coins they bought when they were cheap, and avoid talking about the coins which they bought and made a loss on. The ones that rose, they'll tell you to buy, and to make sure you use their sponsored exchange.
                I watched a metric f-tonne of Youtube and bought a lot of XRP, Algo, HBAR, Cardano which has done nothing in years or I didn't sell the top before they dropped. I fell for the hype, the promise of revisiting All-Time Highs.
                Fortunately, wading through all that mind-numbing crap did result in some valuable lessons, some of it being the opposite of their advice.
                That part you quoted wasn't found in any video I've ever seen.

  • tsunamisurfer on 15/04/2024 - 17:31
    +9

    Cash Withdrawal from a 22% interest facility, then putting it all on black, then not only not repaying it in full but making minimum repayments.

    I think this one takes the cake.

  • pantsparty on 15/04/2024 - 18:02
    +4

    To be honest if you are still thinking of hanging onto the Bitcoin I don’t think you have learned your lesson yet. I personally would sell sell sell but it sounds like you should keep holding and either get lucky, or learn a lesson which will guide you going forward.

  • joka on 16/04/2024 - 06:40
    +4

    All I can say is “yikes”

  • jattsta on 16/04/2024 - 08:09
    -5

    I would say, absolutely hold. It will climb to ATH again quicker than youll realise - possibly in a month or two. Just suck up the fees til then.

  • sammm on 16/04/2024 - 08:29
    +1

    consolidate the credit card. pay that down with out spending on it, or else you will gain more debt.

  • mikekiwimike on 16/04/2024 - 09:30
    +2

    Do not hold a Meme coin or any coin that is not in the top 1 or 2, you have been scammed, by buying on the pump and now you're in the dump. The market is not big enough to support all the stupid alt coins there are out there and you will lose everything if you don't get out……. This is not financial advice!

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