"In a series of surveys and studies, the investigators identified and examined a cognitive bias they call “debt account aversion”: a strong preference of people with multiple loans to pay off smaller debts first, even when it makes more sense to pay down larger balances on loans with higher interest rates."
"Their results show that consumers with multiple debts focus on reducing the total number of outstanding loans rather than on the total debt across loans. This phenomenon is known as "debt account aversion" and it's a strong bias."
"The inclination of consumers to do this is dubbed “debt account aversion”—which is an emotional, as opposed to rational, approach consumers have to debt reduction."
