How to prioritize your debt
Financial expert Nicole Lapin discusses the different types of debt including credit cards, car loans, mortgage payments, and more - and which to start paying off first.
Transcript
[MUSIC PLAYING] I'm Nicole Lapin, your financial expert, with some tips on how to make the most of your money.
Some people think all debt is created equal. It is not. Be smart and follow this strategy
to get that debt monkey off your back once and for all. Your first priority is your credit card debt. It has the highest interest rates.
Even if you have other kind of debt, your credit cards carry the type of debt that will accrue the fastest.
So pay off those cards before moving on to any other kind of debt. Next, car loans.
If you have them, you're paying interest on a depreciating asset, so don't do that. Plus, if you miss too many payments,
they will take your car away. Now, focus on your mortgage after that. The interest rate on your home should be lower
compared to your credit cards and your car loans. And finally, pay off your student loans. And here's why.
They can take away your purchasing power, they can take away your car, they can take away your home, but they can't touch your brain.
So when it comes to debt, remember, you have to prioritize to pulverize. How fit are your finances?
Take the free money fit assessment at sharecare.com for a personalized score and an action plan for a healthy financial future
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