Who’s right ? Paying debt
Hey guys/girls was having this discussion with my cousin. He is about $20k in debt. 15k on credit card (or cards not sure) and I’m assuming interest rate is around 18%. He also has a personal loan at 7% but it is an amortized loan , and he pays about $470 a month. His loan balance is around 5K.
He is getting a 5-7k bonus and asked me what he should do. He was thinking paying down the high interest debt, I told him to pay off the amortized loan in full, because it has the biggest impact on cash flow and he can then free up that $470 a month and snowball it on the card(s).
Thoughts? Who is right in this situation?
He is getting a 5-7k bonus and asked me what he should do. He was thinking paying down the high interest debt, I told him to pay off the amortized loan in full, because it has the biggest impact on cash flow and he can then free up that $470 a month and snowball it on the card(s).
Thoughts? Who is right in this situation?