1. Find your current balance.
2. Find your minimum balance (this may be different from what you actually pay each month).
3. Divide the current balance by your minimum balance.
This will give you a “score” that can be anywhere from 1 to whatever (I have never seen it above 200, but that does not mean it could not happen).
4. The debts with the lowest score are the ones that are costing you the most money.
5. Take into consideration other factors that may affect your decision, including your personal values and goals. I will cover these tomorrow.
Note: Many friends and “experts” will recommend paying off the credit card with the smallest balance first, but this may not be in your best interest.