8 rules of thumb on saving and retirement
The rule: Always pay off your highest-interest credit cards first.
Why it works: All things being equal, retiring the highest-interest credit card debt first, regardless of size, helps consumers minimize the amount of interest they pay over time, says Finke.
Grain of salt: For some consumers, the satisfaction and momentum they gain from starting with the smallest debts and paying them off first outweighs the interest benefit.
Starting with the smallest credit cards can help create a snowball effect, which can often help consumers with a big debt burden pay it off more quickly, says Baughman.