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Do I pay off smaller balances or attack the bigger ones?

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Valued Contributor

Re: Do I pay off smaller balances or attack the bigger ones?


@Caardvark wrote:

There are two schools of thought in the posts above:

  1. Pay down strategically to increase your score (get utilization below relevant thresholds)
  2. Pay down your highest interest debt first

I am firmly in camp #2

Finances ($) > credit score.

 

 There should be no debate. Money trumps credfit score. 


Unless cards get closed for being to close to his limits.

OP asked for plan for highest impact on his credit score.

Most people in this situation have APRs that are all similar.

Paying off small balances can also be very motivating opposed to chipping at a large debt which seems impossible to pay off.

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Message 11 of 14
Valued Member

Re: Do I pay off smaller balances or attack the bigger ones?

Well just to clarify im a woman lol and while getting that larger balance under 1000 is a goal of mine i will be paying off possibly closing the cards that have lower bal. I ultimately want to go from 11 cards to 4 maybe even 3
Message 12 of 14
Established Contributor

Re: Do I pay off smaller balances or attack the bigger ones?


@MeN5 wrote:
Well just to clarify im a woman lol and while getting that larger balance under 1000 is a goal of mine i will be paying off possibly closing the cards that have lower bal. I ultimately want to go from 11 cards to 4 maybe even 3

I picked up on that when I saw the vs card! Smiley Wink

 

You have to see- if they all basically have the same APRs, paying off a bunch of small ones right away may save you more than focusing on a bigger balance, in other words, is the interest paid on 5 smaller accts > the interest on one bigger balance if you carry the smaller balances longer?



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Message 13 of 14
Valued Member

Re: Do I pay off smaller balances or attack the bigger ones?

I have to get that on bal paid down before the 4th thats a must so i wont have any maxed out cards. Also while paying down bals. I gotta pull like 800 out my but for utility collections so i can move back to that city im telling u my next few months will be crazy but by sept im hoping my score will be on the rise
Message 14 of 14
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