Should I Pay Off My Personal Loan or Credit Card First?

Should I Pay Off My Personal Loan or Credit Card First?

Dealing with multiple sources of debt can feel overwhelming at times. Not knowing which debt to pay off first can add to the confusion and stress. Paying off debt from loans and credit cards is hard enough without having to deal with bills and other financial responsibilities. This is where prioritizing and debt management tips can help. However, if you have concerns about bankruptcy, then ask a Chattanooga bankruptcy attorney for help.


When it comes to prioritizing debt, this process starts by listing out all the various debts you have to pay each month. Add any debt you will have to start paying in the future. Then list out your other monthly expenses and financial responsibilities.

Subtract your estimated total monthly expenses from your monthly income to find out how much money you have leftover. You can use this number as a guide to whether you can handle all these expenses at once. This can also help you determine when you can make extra payments on your debt.

Paying off priority debt is more important than paying off debt that does not have to be paid off right away. For example, student loans and mortgages are types of debt that the government does not expect to pay within a few years. Many people might take ten years or longer to fully pay off these debts.

The debts you may want to focus on the most are debts that come with serious consequences if you miss payments. Certain debts have deadlines and may result in repossession, bad credit, or legal consequences if not paid. Prioritize these debts and find ways to cut costs to make sure these payments are made on time.

Other factors to consider when making these decisions are which debts have the highest interest rates. Paying off higher interest rate debt first saves more money in the long run. Taking out small debts first leads to faster results in terms of reducing overall debt.


Common tips for paying off credit cards revolve around budgeting and cutting back on using credit cards. Paying off credit card debt before adding more credit card debt to the total debt is a smart move. Budgeting will help you know where to cut back on spending to pay off credit card debt faster.

In terms of paying off loans, the best methods include bi-weekly payments, rounding up monthly payments, and making at least one extra payment a year. Following these rules can go a long way toward paying off loan debt faster. Anytime you can make an extra payment, you have a financial advantage. Lastly, refinancing is an option that could reduce the interest of your loan.


Going through bankruptcy can be daunting and often stressful. You can call us today at Tom Bible Law by dialing (423) 690-7712 for a consultation about how bankruptcy works. Our team of Tennessee bankruptcy lawyers is ready to help you escape your financial situation by exploring various bankruptcy options. We can be found throughout the Tennessee cities of Chattanooga and Tullahoma.

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