I have an extra $2000 a month to put towards my debt, how should I apply it?

[cdward]

A
B
C
D
E
F
G
1
Servicer
Payoff Amount
Interest Rate
Min. Monthly Payment
Interest Type
Loan Type
2
Firstmark
$12,007.96
11.16%
$162.17
Variable
Student
3
Firstmark
$6,019.49
11.14%
$162.17
Variable
Student
4
EdFinancial (Dad)
$9,859.85
6.06%
$115.71
Fixed
Student
5
EdFinancial (Dad)
$1,995.74
6.06%
$23.43
Fixed
Student
6
EdFinancial (Dad)
$7,240.63
6.75%
$87.36
Fixed
Student
7
AidVantage
$3,361.77
3.51%
$35.15
Fixed
Student
8
AidVantage
$2,157.13
3.51%
$22.58
Fixed
Student
9
AidVantage
$1,684.34
4.20%
$18.16
Fixed
Student
10
AidVantage
$1,039.73
4.20%
$11.22
Fixed
Student
11
AidVantage
$4,338.65
4.80%
$48.04
Fixed
Student
12
AidVantage
$1,001.92
4.80%
$11.10
Fixed
Student
13
AidVantage
$983.93
4.80%
$10.90
Fixed
Student
14
DCU
$10,326.00
10.99%
$285.13
Fixed
Personal
15
DCU
$33,845.38
7.49%
$667.42
Fixed
Auto
16
AidVantage (Mom)
$10,022.26
7.60%
$125.62
Fixed
Student
17
AidVantage (Mom)
$2,219.24
7.60%
$27.84
Fixed
Student
18 19
Total
$108,104.02

$1,814.00

EDIT: To clarify, I have an extra $2000 a month to allocate on top of the minimum payments of $1814.

 

[zaphnatpanea]

@cdward Easy.

Put all your loans in an Excel sheet and order by interest rate descending. Then pay the first one, and so on.

Google sheets may also work.

 

[cdward]

@zaphnatpanea Didn't realize it was that straight forward, thanks!

 

[thehoodedcow]

@cdward Sort by column D by descending, start at the top.

 

[meursault]

@cdward No question here: Put all of it (the extra) towards your highest interest loan and pay them off in descending order.

Congrats on being able to pay these off! $3800 a month means you can be debt-free in less than 3 years if you’re disciplined. Greatest feeling ever.

 

[laurenelizz]

@cdward What's the deal with this $34k car loan? Sounds like a lot of car for someone who's in debt?

 

[cdward]

@laurenelizz 3hr round trip commute 4x a week, needed a dependable vehicle thats good on gas.

 

[laurenelizz]

@cdward I have an old Prius which is dependable (7 years of driving with no issues) and good on gas (48 MPG everywhere) and I got it for $11k. You definitely don't need to spend > $34k to get a dependable fuel-efficient car.

 

[meeky]

@cdward Also consider loan consolidation. If you can get those 11% loans down into one large loan at say 6%, you would be in a better place. That said, I dont know what consolidated loan rates are like these days.

 

[cdward]

@meeky Unfort I did not graduate college because of that all of the lenders I have talked to will not consolidate my student loans

 

[cdward]

To clarify, I have an extra $2000 a month to allocate on top of the minimum payments of $1814

 

[loveforever8]

@cdward 2, 3 and 14 first. Sell the car and buy something smaller.

What do mom and dad mean, are they your loans or not?

 

[meursault]

@loveforever8 Disagree with this. Buying a brand new car was not a great choice, but he’s already in it and might as well pay it off while enjoying the warranty and reliability.

 

[cdward]

@loveforever8 Parent Plus loans, parents took them out but I am morally obligated to pay them back.

 

[washburn]

@cdward You've already gotten responses that, correctly, point out that paying your debts off in highest-to-lowest interest rate will result in you paying the least total amount of interest and getting out of debt the fastest. This is the "Avalanche" method.

But... There's another popular method called the "Snowball" that does the payoff from smallest-to-largest balance order. That usually has the advantage of reducing your total min. monthly payment amount in cell E19 at a more rapid pace.

That is, it "frees up" money faster, turning money you have to pay on your debts into money you wisely choose to pay on your debts. It lowers risk through increasing the chance that, if some emergency strikes, you'll be able to cash flow it and not have to go into more debt. (Plus there can be a motivational boost from getting those "quick wins", although a lot of people on this sub discount that.)

Is the Snowball's disadvantage in interest and time worth those advantages? That's up to you and how small the difference between the two methods is. You can use a calculator like the one at unbury.me to compare them.