Which Debt Should You Pay First?

man and woman looking at a tablet with bank account statemnts and calculator on a table

Couple going over their debt | Source: iStock

Many people believe that credit card debt is the worst kind of debt. Credit card debt can be a big problem, and this is especially true if you live in one of the 10 cities with the most credit card debt. However, it isn’t always the worst kind of debt, and sometimes, you will have a good reason to pay a different debt off first. You need to take several things into consideration when determining which debt you should pay off first.

What is the worst of your debts is only one part of the equation. You also need to determine which of your debts might be helping build your credit score (or hurting your score), and how the different debts affect your goals, as well as your finances (including your taxes). Here are four key things to consider before you rush to pay off your credit card.