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What loans to pay off first?

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    What loans to pay off first?

    I understand paying the loan with the highest interest rate off first, while paying the minimum payment to the other loans. However, we have 2 student loans (that cannot be consolidated) and they both have the same interest rate. Which do I focus on? The one with the lesser amount, or smaller monthly payment?

    #2
    Originally posted by summerdsea View Post
    I understand paying the loan with the highest interest rate off first, while paying the minimum payment to the other loans. However, we have 2 student loans (that cannot be consolidated) and they both have the same interest rate. Which do I focus on? The one with the lesser amount, or smaller monthly payment?
    Payoff the smallest balance to largest.
    Got debt?
    www.mo-moneyman.com

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      #3
      Originally posted by summerdsea View Post
      I understand paying the loan with the highest interest rate off first, while paying the minimum payment to the other loans. However, we have 2 student loans (that cannot be consolidated) and they both have the same interest rate. Which do I focus on? The one with the lesser amount, or smaller monthly payment?
      Originally posted by tripods68 View Post
      Payoff the smallest balance to largest.
      Financially speaking, it doesn't matter since the rates are the same.

      However, tripods68 is correct. Focus on the smaller balance first because that will free up that money to then snowball to the other one.
      Steve

      * Despite the high cost of living, it remains very popular.
      * Why should I pay for my daughter's education when she already knows everything?
      * There are no shortcuts to anywhere worth going.

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