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I used to think paying off my smallest card first was the only way to go | Credit Advice - Freelance Forum - The Community for Independent Professionals

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hunt.jennifer•6mo ago

I used to think paying off my smallest card first was the only way to go

For years, I focused on my $500 store card because it felt good to close it. But my friend, who works at a bank, told me to look at the interest rates instead. My bigger card had a 24% rate, and the small one was only 12%. So I switched all my extra money to the high-rate card last month. It's already saving me about $15 in interest, which adds up. Has anyone else made this switch and noticed a real difference?

3 comments

3 Comments

kellyallen6mo ago

My cousin did the exact same thing with her student loans versus a car loan. She was throwing everything at the smaller student loan balance for the mental win, but the car loan rate was way higher. Once she switched, the math just worked out better for her overall payments. It's a tough habit to break when you want that quick win of paying something off.