How To Prioritise Your Debts
| Self Development : Money If you get into debt for any reason, it can be hard to get out of it. Typically you might take on one debt to pay off another - for instance get a bank loan to pay off a credit card loan. When you are paying back debts, you should ensure that you do them in the right order. For instance, the one with the highest interest rate is the one that you should prioritise to pay back first. If your credit card has interest at 16% and your bank loan at 9%, then it is going to cost you a lot more to pay back the credit card debt than the bank loan. Therefore be sure to prioritise your debt. If you have a monthly credit card bill, and are able to pay the amount off in full, then try to get into the habit of paying it off in full each month. Many people are tempted just to pay off the minimum balance when they could afford the full balance, as they want to keep some money for a rainy day. However this is bad thinking, because the interest payable on the debt you don't pay off will cost you a lot more in the long run.
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