This post is the forth in a series of 9 posts under the category of “Save” and this one is really a “No-brainer”!

Well, maybe a “no-brainer” but good advice and worth repeating here. It’s simply, “Pay Off High Interest Debt First”. Yep, it’s that simple.

This series of posts is essentially be reprints of 9 articles from, a Securities and Exchange Commission  web site. The 9 articles present a roadmap to sound saving and investing. You are invited to visit to view the original articles.

The 9 steps to the Savings and Investing Roadmap are:

Define Your goals (previous post)
Figure Out Your Finances (previous post)
Small Savings Add Up to Big Money (previous post)
Pay Off Credit Cards or Other High Interest Debt (this post)
Save for a Rainy Day
Understand What It Means to Invest
Diversify Your Investments
Gauge Your Risk Tolerance
Learn About Investment Options

Here’s the advice with a few good rules for controlling high interest debt from

“Pay Off Credit Cards or Other High Interest Debt

No investment strategy pays off as well as, or with less risk than, eliminating high interest debt. Most credit cards charge high interest rates — as much as 18% or more – if you don’t pay off your balance in full each month. If you owe money on your credit cards, the wisest thing you can do is pay off the balance in full as quickly as possible. Virtually no investment will give you returns to match an 18% interest rate on your credit card. That’s why you’re better off eliminating all credit card debt before investing. Once you’ve paid off your credit cards, you can budget your money and begin to save and invest.

Here are some tips for avoiding credit card debt:

Put Away the Plastic

  • Don’t use a credit card unless you know you’ll have the money to pay the bill when it arrives.

Know What You Owe

  • It’s easy to forget how much you’ve charged on your credit card. Every time you use a credit card, track how much you have spent and figure out how much you’ll have to pay that month. If you know you won’t be able to pay your balance in full, try to figure out how much you can pay each month and how long it’ll take to pay the balance in full. (see the editor’s note below)

Pay Off the Card with the Highest Rate

  • If you’ve got unpaid balances on several credit cards, you should first pay down the card that charges the highest rate. Pay as much as you can toward that debt each month until your balance is once again zero, while still paying the minimum on your other cards. The same advice goes for any other high-interest debt (about 8% or above), which does not offer any tax advantages

(editor’s note: If you are looking for a good tool to consolidate credit card balances and other debt, consider MoneyDesktop, a personal financial management tool offered by Tri-Town Teachers Credit Union free to members.)

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