How To Pay Off Multiple Debts

Added March 23, 2009 by Ilyce R. Glink

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Summary: If you’ve got several debts you’re ready to pay off, start with the one with the highest interest rate. Once that debt is paid off, you can use the extra money to pay the debt with the next highest rate. By taking all the cash you’re pouring into paying off a balance and putting it toward your next balance, you’ll put a dent in your total debt much sooner.

Q: I am interested in paying off 4 revolving accounts. Which accounts do I pay off first, the high interest or the high balance?

A: Pay off the account with the highest interest rate first while continuing to make your regular payments. Throw every spare cent you have at this debt.

Once you're done, take the amount you've been paying on the now paid off account and transfer that to the balance with the next highest interest rate. And then the next, and then the next.

You'll find that by taking all the cash you're pouring into paying off a balance and putting it toward your next balance, you should very quickly be able to make a dent in these other piles of debt.

I have a lot of additional information on my web site about this if you want to read further. Good luck.

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