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Understanding Payment Methods

There are four common methods for paying down your debt. All of them except for the Minimum Payment method are valid. The minimum payment is to be used as a reference amount to show how much better you can do by adding just a bit more to your monthly payments.

The Highest Interest method is almost always going to save you the most money, but it does not have to be the method you choose. Many times you need more encouragement during your debt reduction process so the Lowest Balance method may work better for you. If you have five credit cards and you can pay off one of those quickly and use that extra money to pay down other cards, then paying the lowest balance first can feel really good. Because of this, Debt Quencher will choose the method with the fewest payments if the difference in total money paid is less than one percent.

The Highest Balance method probably won't be the best method, but there is a chance that it could be picked. It's also a good reference to see just what you can save by shifting a few dollars here and there.

Accounts List

To change your payment method:

  1. First, make sure that you have increased one or more of your planned payment amounts higher than the minimum
  2. Review the Savings column and compare the amounts (the green arrow will always point Debt Quencher's pick)
  3. Click on one of the payment method rows to select your method (it doesn't have to be the one marked as best)

See also

Adding accounts
accounts