Are you making payments to four, five, or six loans, all with different balances and interest rates? Do you have some extra money you want to put towards your loans so you’re not paying on them till retirement? The only question; which loan should you payoff first? Will it save more money to first payoff the student loans, the car, or the credit card?

DO NOT CONSOLIDATE YOUR LOANS! Instead, use the Savings for Early Lo​an Payoff spreadsheet to know exactly where to put your extra payments so they make the most impact on reducing your debt!

The Savings for Early Loan Payoff will give you transparency of the interest accumulated on your loans and the amount of interest you can save from the extra payments. This is the exact calculator I used to pay down my car and student loans.

I don’t know about you but I want to get out of debt (that isn’t creating monthly cashflow) ASAP. And the fastest way to get out of debt is to payoff the loan that’s accruing the most interest. The interest accrued on each loan is laid out in a simple and convenient way on the Savings for Early Loan Payoff spreadsheet. You will never again wonder how much money you are wasting in interest or saving with extra payments!

NOTE: If you are struggling to pay down any of your debt then use the Dave Ramsey Debt Snowball as it gives you a quick win and builds momentum.

If you haven’t heard of the Debt Snowball strategy its simple – organize your loans in order of smallest loan balance to largest loan balance and pay off the smallest loan balance first. Once the smallest loan balance is paid off, put all payments (including the monthly payment from the smallest loan balance) towards the next smallest loan. Continue this until all debts are paid off.

Example: You have a $15,000 car loan at 2% ($350/mo payment), $12,000 in credit card debt at 18% ($150/mo payment) and one student loan of $10,000 at 6% ($250/mo payment). You have an extra $500/mo you want to use to pay off debt. Using the Debt Snowball method, you would put all the extra $500/mo towards the $10,000 student loan. Once that student loan is paid off you would put $750/mo ($500 + $250) towards your credit card until the credit card is paid off. Finally, you would put $900/mo ($500 + $250 + $150) towards your car loan until that is paid off.

Remember: the Debt Snowball is simpler and will give you a quick win but paying down the loan that’s accruing the most interest (via Savings for Early Loan Payoff) will save you the most money.

The best strategy is one that you can stick to!

Best of luck!

- Cameron Tope