This article is part of a series on credit card debt reduction strategies. Visit the links at the end of this article to read about other debt reduction strategies to find one that’s right for you. These will be added once the articles have been published.

There is no “right” or “wrong” way to pay off your credit card debt. In fact, there are many schools of thought as to which debt reduction strategy is the best. We understand that everyone’s situation is different, and that different debt reduction strategies will work for different people. Today we’ll look at one option: paying off your lowest credit card balances first.

Reasons to Consider Paying off Your Lowest Balances First

There are two main benefits to tackling your credit cards with the lowest balances first:

1. Peace of mind — There’s something not only relieving but also motivating about knowing you’ve paid off a credit card balance completely. Lower balances are obviously easier to pay off in full, so they’re a good place to start.

2. The snowball effect — When you use this debt reduction strategy, it’s common to use a snowball approach. For example, when you pay off that lowest balance, you would then take that card’s usual monthly payment and add it to the monthly payment on your next lowest balance so you pay that card off more quickly.

Then when that card is paid off, you add that total monthly payment to the regular monthly payment on your next lowest balance to pay that one of even faster too. The idea is that you continue to pay the same amount of money towards your credit card debt every month, even when a card balance is paid off, and that speeds up the process of paying off the higher balance cards.

The Downside of Paying off Your Lowest Balances First

This debt reduction strategy isn’t perfect. If your highest balance credit card also has the highest interest rate, you’ll pay more in interest by paying that debt off slowly.

For example, let’s say you have $500 in debt on a BankWest Lite MasterCard with an interest rate of 9.99%. You also have a $2500 balance on a Citibank Gold Visa card with a 20.49% interest rate. You would save money on interest by paying the Citibank card off first instead of the card with the lower balance.

In the end, you have to choose the right credit card debt reduction strategy for you. Some people are motivated by the fact that they’ll save money paying down higher interest cards. Other people get frustrated when paying down big balances, so the feeling of accomplishment of paying off a lower balance card first motivates them to keep on going instead of giving up.

If this credit card debt reduction strategy doesn’t sound right for you, that’s okay! Check out the other posts in our series to compare this plan with other debt reduction plans:

•    Pay Off Lowest Balances First
•    Pay Off Highest Interest Cards First
•    Flat Rate Credit Card Payments
•    Balance Transfer Debt Consolidations

Find the right credit card debt reduction plan, and you’ll be out of credit card debt in no time!