Debt Basics

Debt isn’t always bad — but unmanaged debt can cost you peace of mind and money. The goal is to understand your debt, create a payoff strategy, and keep it from controlling your finances.

Types of Debt

Good Debt

Can increase your net worth or generate income (e.g., mortgage, student loans with a payoff plan)

Bad Debt

High-interest debt like credit cards or payday loans that drain your resources

Pay Off Strategies

Pay smallest debts first for quick wins and to put more towards larger debts over time.
Pay highest interest debts first to save money long-term.
Combine debts into one payment, ideally at a lower rate.