How to Pay Off Debt Faster and Prioritize Your Debt
Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
Did you join David Bach last month in his Facebook Live Chat?
Don’t miss the next Live Chat, this Thursday, with TaxMama Eva Rosenberg. She can answer all your questions about filing your 2010 taxes. Sign up now on the Equifax Facebook Fan Page.
Here are some questions fans asked David and how he answered them:
Could you tell me if it is better to pay additional monthly payments toward your mortgage principal or pay any additional payments in one lump sum? Currently I pay an additional monthly amount and then another lump payment with my Dec. payment. Is it better to divide this lump sum into 12 months and pay the additional monthly instead of yearly? I would really appreciate your response.
Shelby, if you pay it monthly, you will reduce the principal faster. But truthfully I don’t think it matters that much. What matters is that you simply make extra payments on your mortgage. I personally make extra payments each month, and then based on my income I make extra payments a few times a year. The most important thing when you prepay a mortgage is making sure that the money is credited by the bank against the principal. It’s amazing but true that banks will often take the extra payments and hold on to them in an account and not pay you interest or pay down the mortgage until you ask! It’s happened to me, and to my readers. So watch extra payments like a hawk.
Do I pay my student loan off before I start paying off $35,000.00 in credit card bills?
Regina, I would definitely be paying off my credit card debt before my student loans. The interest rate is more than likely much higher on the credit cards than the student loans. The one exception to this rule is if you plan to go bankrupt. Credit cards can be walked away from in bankruptcy, and student loans can’t.
Is it better to pay off your house or save the money? I am leaning toward paying off the house. It is the last thing I owe money on. I could pay it off in about 4 years . . . $87,000 . . . What do you think?
Angie, I would have at least six months of emergency expenses set aside, and then I would pay off your mortgage. You’ll love being debt-free. The one thing is, however, I want you to also max out your retirement account at work if you have one, or at least max out a deductible IRA each year. So max out those retirement accounts and then make the extra payments on the mortgage.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.