$25,000 line of credit
$20,000 on credit cards
$17,000 in cash gifts
Remaining debt: $28,000
Breaking
down the debt
Focus on highest interest rates first with the "avalanche method"
List all your debts by their interest rates, from the highest to lowest. While it’s important to make the minimum payments on all your debts, this method prioritizes paying more than the minimum payment for the debt with the highest interest rate.
Build momentum through the “snowball method”
Under this method, you still make minimum payments on all your debts, but you allocate additional funds towards the smallest debt amount until it’s paid off.
Revisit your budget
Look to your budget to see if you can find areas where you can reduce spending, such as dining out. If you can find any extra money in your budget, you could use it to repay more of your debt.
Tips on tackling debt