How do I know which credit card to pay off first?

You should pay off the credit card with the highest interest rate first because you’ll save the most money that way. Apply the biggest monthly payment you can manage to the balance with the highest interest rate and pay at least the minimum amount due on your other credit card accounts to avoid credit score damage. Then, move on to the balance with the next highest interest rate and repeat the process with each card until you’ve wiped out all of your debts.

The various approaches to this problem have their own merits and drawbacks, though, depending on your financial situation and goals. You can learn more about your options below.

Common Credit Card Payoff Strategies

1. Pay off the card with the highest APR first.

This strategy is called the avalanche method, and it could save you hundreds – if not thousands – of dollars in interest. But it could take longer to pay off your first balance. This could make it harder for you to stay motivated to keep paying down your debts.

2. Pay off the card with the lowest balance first.

Also known as the snowfall method, this strategy will make you feel like you’re making progress. As soon as you pay off the account with the lowest balance, move on to the card with the next lowest balance, and so on until you’re out of credit card debt. Just don’t forget to make at least the minimum payment on your other accounts as you go.

3. Pay off the card with deferred interest by the time limit.

If one of your credit card balances is from a deferred interest offer, you should pay it off before the promotional period ends. Otherwise, you’ll be on the hook for all retroactive interest, dating back to the original purchase date.

Ultimately, feel free to take a look at our editors’ picks for the best balance transfer credit cards and debt consolidation loans in order to weigh your options.