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I have 3 private student loans.

Outstanding Principal Balance taken 08/2011 $15,000.00
Outstanding Accrued Interest as of 08/21/15 $6,678.26
Interest Rate 11.75%

Outstanding Principal Balance taken out 08/2012 $11,300.00
Outstanding Accrued Interest as of 08/21/15 $3,546.16
Interest Rate 11.45%

Outstanding Principal Balance taken out 08/2013 $6,000.00
Outstanding Accrued Interest as of 08/21/15 $1,186.02
Interest Rate 10.99%

Which loan should I start paying back first?

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    Highest interest rate first. Aug 22, 2015 at 23:48
  • How long are you planning on it taking you to pay all of them off?
    – Ben Miller
    Aug 23, 2015 at 2:32
  • Good gravy! Why so high interest on student loan debt?
    – Patches
    Aug 25, 2015 at 16:05

1 Answer 1

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Strictly from paying overall less interest and paying off faster, you should pay the one with higher interest rate first.

However depending on individual, it makes more easier for someone to see the number of loans going down, in such cases it makes sense to get rid of a loan with lowest amount and gain that psychological advantage.

Related question
Why would anyone want to pay off their debts in a way other than "highest interest" first?

Is it better to pay off a loan with a higher interest rate or one with a much higher principal balance?

I've often heard of the "snowball" method for paying off credit card debt. How does it work?

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    And in this example, where the interest rates really aren't much different, that psychological advantage can easily outweigh the strictly financial guideline of highest interest first. Aug 23, 2015 at 14:39

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