Which card to pay off first?

RedSoleShoes

I keep reading that you should always pay the highest insterest rate card first but what if that has the lowest balance?

For example, if you owe £3000 on a 8% card and £1500 on a 10% card, is it still worth concentrating on putting as much as possible onto the £1500 balance and just paying the minimum on the £3000, when the monthly interest is greater on the larger balance?

Hope that makes sense!

Thanks

Degenerate

LilyDeTilly wrote: »

I keep reading that you should always pay the highest insterest rate card first but what if that has the lowest balance?

For example, if you owe £3000 on a 8% card and £1500 on a 10% card, is it still worth concentrating on putting as much as possible onto the £1500 balance and just paying the minimum on the £3000, when the monthly interest is greater on the larger balance?

Hope that makes sense!

Thanks

Highest interest first. Balance is irrelevant.

Apricot

Have a look at the Snowball Calculator

talana

For example, if you owe £3000 on a 8% card and £1500 on a 10% card, is it still worth concentrating on putting as much as possible onto the £1500 balance and just paying the minimum on the £3000, when the monthly interest is greater on the larger balance?

Or to put it another way, £1500 on a 10% card and £1500 on an 8% card and ANOTHER £1500 on an 8% card.
Now which will you pay off first?
As post 2 said, balance is irrelevant. Highest interest first, every time.