Gary North

You are in a deep hole. There are many places where you can start climbing up that wall of debt.

A standard piece of advice is to start paying off the credit card with the highest interest rate. This is good advice if you have more than one credit card.

Dave Ramsey has given advice to thousands of people. He says you should pick a small debt and pay it off. Then go for the smallest debt that replaced the one you have paid off. He calls this the snowball effect.

His logic applies to people who are so far in the hole that they are beaten psychologically. They need a victory. The way to get it is to pay off a bill.

I guess it is like living in a messy home. The entire home is a mess. Which room should you clean first? The room where you spend the most time? The room which guests see. The logic here is to clean the smallest room. Get a victory.

If you are desperate for a victory, pay off your smallest debt. Don't take on any more debt. Then pay off the one that is now at the bottom.

If you want to get out of debt faster, pay off the credit card with the highest interest rate.

But start.