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Get Out of Debt

Which Debt Should You Pay Off First?

Debt, much like Jean-Ralphio’s sister Mona-Lisa, is literally the worst.

It sucks up your money, causes stress and can hurt things like your credit score. The worst! I know you want to pay off all your debt ASAP. When you have different kinds of debt though, which should be the first to go?

The number one thing you need to do when you decide to get serious about paying off all your debt is understanding what kind of debt you have. Not all debt is the same. It’s important to know how much you owe, where you owe it and what your interest rates are.

If you have only one kind of debt figuring out how to pay it off is fairly simple. If you have student loan debt in the form of three federal loans there are two common strategies to consider: paying off the highest interest loan first or paying off the lowest balance first. The first is called the debt avalanche method, the second is the debt snowball method. Decide which method would be most beneficial to you and go for it!

If you have multiple streams of debt things might seem a bit dicier. Say you have $5,000 in credit card debt, $20,000 in student loan debt and a car loan of $3,000. Total you have $28,000 worth of debt but which one do you tackle first? Where to start?

The dirty little secret I’ve got for you is that you should still follow either the avalanche method or the snowball method. Consumer debt like credit cards usually has a much higher interest rate than student loans. If you choose the avalanche method of paying off the highest interest debt first then you’re decision is made for you! You start with the credit card and when that’s done, take those payments and send them to the next highest interest rate debt. Easy as pie.

If you’re having trouble deciding which method is for you do a quick check in with yourself. Are you impatient to see progress? Will you feel more motivated to keep going once you see an entire loan wiped out? Then opt for the snowball method. Paying off the $3,000 car loan will happen faster than paying off the $5,000 in credit card debt. The success of that first payoff will keep you going!

If you’re someone who hates interest and stresses about the money lost to that, go with the avalanche method. You’ll save more money in the long term because you’ll pay less in interest overall. Knowing you’re saving money will motivate you to keep on keeping on.

You may feel panicked or out of control if you have debt coming at you from different areas. It’s important to stay calm and collected. Debt is not forever. Having a concrete plan to pay off your debt will help you feel less uneasy with the total load. Following through on your plan will keep you motivated. Seeing progress on debt payoff is so exciting! The more you pay off the more control you gain over your life. So come up with you game plan and stick to it!

Which debt do you plan to pay off first?


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Erin Thompson

Erin Thompson spent years managing her own blog about budgeting and debt. Because of that, she has great insights not only about managing spending and borrowing but also about running websites profitably. When she's not writing articles for us, she's traveling and looking for new types of wines to try.
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The content on is for informational and educational purposes only. It is not financial advice and we are not certified financial advisors. strives to keep its information accurate and up to date, but it may differ from actual numbers. We may have financial relationships with companies listed on our site. We may receive compensation for the placement of sponsored products or services. We work hard to write authentic and accurate articles.