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I read somewhere (somewher on The Motley Fool, I think) that a debt repayment strategy should be based on the lifespan of the debt. You take the minimum payment, multiply that by the interest rate, and then rank your debts according to the result. Pay the lowest one first. Like that.

My question is, should that include credit cards AND installment loans, or just cards?


I'd generally focus on the cards first as the debt in question is unsecured. If you have a car loan, then in theory you could sell the car and recoup enough money to pay off the loan. Not so with credit card debt. Granted, depreciation on a car usually won't allow this, but percentage wise you're probably closer with a car than a sweater. ;-) The other reason is that (usually) the interest rate charged on credit cards is higher than on other installment loans. By paying off the cards first (highest to lowest rates) you minimize the amount of interest you pay.
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