The first order of business on the path to being debt free is taking stock of how much you owe, said Stacy Yanchuk Oleksy, CEO of Money Mentors.
The avalanche method begins with paying off the loan with the highest interest rate first while still making minimum payments on the others. Deciding which of the two methods will work best depends on the person, and there's no wrong answer, Oleksy said. If a person has consistently not had success paying off debt, the snowball method could work best because it brings smaller wins under their belt.
Jason Heath, an advice-only certified financial planner with Objective Financial Partners, suggests prioritizing consumer debt such as credit cards — which tend to have relatively high interest rates — over other debt.If credit card debt is piling up, he suggested speaking to a non-profit credit counsellor or consolidating it into a single loan.
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