My last post brought up the debate about whether the interest rate is significant when deciding whether to pay off highest debt first or lowest debt first when the rates are only a point apart.Here is what I came up to (I'm not comfortable putting my exact debts on a public forum)Smaller debt = (10.9%)Pay minimum until paid off: total interest $1162Pay large chunks and pay it off quickly: total interest $308Larger debt = (9.9%)Pay minimum until paid off, total interest paid $6951Pay large chunks and pay it off quickly: total interest $1329So, the interest rate really isn't a factor here. The amount of the debt negates the importance of the rate. Even if the rate of the small one was 12%, the total for paying it off quickly would only be $342.If it was 19% it would still only be $566. So, I have decided that paying off the big one, even with the lower rate, will be better in the long run, and it will make me feel better to see this large number drop. Thanks everyone for the inputs. It really made me think it all through.
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