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How interest rates affect your debt payoff


If you have multiple debts,💸💸 chances are they have different interest rates,📈📍 some higher than others. In a debt payoff plan, it's best to pay the credit cards💳with the highest interest rates first - from a financial standpoint at least. ⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
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The Cost of a High-Interest Rate📌🔒

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It costs more to carry a balance on a high-interest rate credit card. That's because your monthly finance charge is based on your interest rate and your balance - the higher your interest rate, the higher your finance charge will be.📊 Not only that, the longer you take to pay off the card, the more money it costs you because you pay more in finance charges when you pay the debt off slowly. Paying off high-interest rate debt first saves money and usually lets you pay off the debt faster.💡💡🔌
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Could Paying the Smaller Balance First Work?🤔🤔

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Paying high-interest rate debt first makes sense from a financial standpoint, but that method isn't best for everyone. When small debts are paid off sooner, you remain motivated to pay off the next debt and the next until you're debt free.🤗😥
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It's true that the 🥑smallest-balance-first method lets you pay off some debts sooner in the beginning.🙄 ⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀ ⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
Having an account completely paid off is a great feeling. But remember, it takes you longer⏰⏳ to pay off the debt completely under the smallest-debt-first method.
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When you're ready to pay off your debts, you have to decide if you need the motivation🚀 from paying off smaller debts at the expense of spending more money on interest. Don't spend too much🛀🛌 time thinking it over; the important thing is that you get started even if it means paying off some debts quickly.🛫

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How interest rates affect your debt payoff
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