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 Paying off Debt 
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Hold the door!

Joined: Sun Jun 01, 2014 10:26 pm
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Location: West Chester, Pennsylvania
Post Paying off Debt
Calling all financial experts. If you had 17k in debt at 5% APR and 21k in debt at 10% Apr, would you pay all the extra payments to the 21k at 10% and only pay the minimum on the 17k?


Sat Apr 20, 2024 2:05 pm
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Superfreak
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Joined: Sat Aug 20, 2005 12:54 am
Posts: 22115
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Post Re: Paying off Debt
At quick glance, yes; $21k is more than $17k, and 10% is higher than 5%...

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Sun Apr 21, 2024 1:28 pm
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Devil's Advocate
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Joined: Sun Jul 31, 2005 2:30 am
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Post Re: Paying off Debt
zwackerm wrote:
Calling all financial experts. If you had 17k in debt at 5% APR and 21k in debt at 10% Apr, would you pay all the extra payments to the 21k at 10% and only pay the minimum on the 17k?

What's the minimum for each?

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Sun Apr 21, 2024 5:09 pm
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Hold the door!

Joined: Sun Jun 01, 2014 10:26 pm
Posts: 20736
Location: West Chester, Pennsylvania
Post Re: Paying off Debt
Shack wrote:
zwackerm wrote:
Calling all financial experts. If you had 17k in debt at 5% APR and 21k in debt at 10% Apr, would you pay all the extra payments to the 21k at 10% and only pay the minimum on the 17k?

What's the minimum for each?

$400 something for the 21k, like $200ish for the 17k


Sun Apr 21, 2024 10:04 pm
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Devil's Advocate
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Post Re: Paying off Debt
I've never been in debt but I can't really think of any reason not to pay the bigger one with more interest.

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Sun Apr 21, 2024 10:23 pm
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Extraordinary
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Joined: Tue Oct 12, 2004 12:25 am
Posts: 19202
Location: San Diego
Post Re: Paying off Debt
Maybe you can do a balance transfer to a new credit card that has no interest for x amount of months if your credit allows you to open another card.


Sun May 05, 2024 1:25 pm
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Newbie

Joined: Fri Oct 25, 2024 5:41 am
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Post Re: Paying off Debt
Absolutely, that strategy can be effective. By focusing on the 21k debt with the 10% APR, you're reducing the interest you'll owe in the long run. Since it's the higher interest rate, the cost of this debt overtime accumulates faster than the 5% APR on the 17k debt. By making extra payments towards the 21k, you minimize the amount that would otherwise balloon with interest. Meanwhile, just paying the minimum on the 17k keeps it in check without diverting your resources too thinly. This method is often referred to as the "avalanche method" and is a great way to save money on interest payments over time. By the way check this https://gamdom.co.com/ platform for amazing games and bonuses


Fri Oct 25, 2024 5:44 am
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