Pay off Credit Cards or Student Loans?

[UPSGregg]

Pay off the lowest balance first then apply the payment you were paying on that onto the next lowest. It's called the debt snowball. I suggest taking a look at daveramsey.com and his 7 baby steps. It works.

[RockinRay]

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@Anonymous wrote:

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@ewingerter wrote:

I need some advise on which to payoff first.  My UTL is at about 75% and my student loans interest rates are 6.30 compaired to CC 17.24%.

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This should be a no brainer for you 

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Agreed! Do the math and let it guide you. Math never lies.

[Wolf3]

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@UPSGregg wrote:
Pay off the lowest balance first then apply the payment you were paying on that onto the next lowest. It's called the debt snowball. I suggest taking a look at daveramsey.com and his 7 baby steps. It works.

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I suggest you don't.    You should do the math based on what the interest costs are.   The snowball technique is a motivational trick that can cost you a lot of extra money.

[Anonymous]

Just be sure to continue paying on the student loan and never defer.  In most cases student loans are not dischargable in BK and will follow you forever!

[frogfan12]

Pay off the CCs first and then use the money you'd use for those extra CC payments to pay off your student loans. And student loan interest rates are not that low. Mine hover between 6 and 8 percent. That's pretty steep, considering some people have interest rates of 2-4 percent.

[haulingthescoreup]

Always useful to remember that attempted irony often backfires on a public internet forum.

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OP, I agree with the others --CC's first. Not only is the APR higher in your case, but if you're considering your FICO scores as well, lowering the util on your CC's will be helpful to your scores. Student loans are installment credit, and util on installment has a very low effect on your scores compared to revolving util.

My own belief is that financial sense outweighs scoring sense, and when paying off the cards first gives both financial AND scoring benefits, it's the right decision.

[Chris123nTx]

Forget the interest rate argument ----- student loans will never ever go away untill they are paid in full.

Thats my opinion of course, but if you spend any time in the student loan forum, you will find destroyed cred and dreams because something unexpected happens and you find yourself not being able to pay.

Get rid of those as fast as you can.
Good luck

[JustMe77]

What are the balances on each card/loan and interest rate? Are all the credit card balances with that high interest? How long do you think it will take to pay each one off?

While student loans have a lower APR in this case, you can't get rid of them in bankruptcy. 

You can do the 'debt snowball', where you ignore APR and just pay the smallest balance first. It doesn't make sense mathmatically, except it motivates you to keep paying down the debt and you will feel a sense of accomplishment after each balance is gone. It's easier to keep track of just one balance instead of five, kwim?

Or, you could just pay the highest interest rate debts first. Bringing down your credit card utilization ratio should give your FICO a nice boost.

Do what works for you, there's no 'right' way. If it were me, I would get rid of the student loans,

[haulingthescoreup]

Maybe I missed something here, but I don't remember OP saying anything about only being able to pay off one or the other:

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@ewingerter wrote:

I need some advise on which to payoff first.  My UTL is at about 75% and my student loans interest rates are 6.30 compaired to CC 17.24%.

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If it were an either/ or case, and there was genuinely no alternative, then I would agree with paying off the SL's and letting the CC's crash and burn. Sad, but less devastating in the long run.

But unless there's something I haven't read on another thread (very possible), I think OP was just asking about which to go after first.