Question

Hudson always makes the minimum monthly payments on all of his debts, on time. He receives a raise at work which gives him an extra $250 per month in take-home pay. If his primary goal is to minimize the amount of interest he'll pay over the lifetime of his debts, which debt should he pay down most quickly using his increased pay?* His car loan with a 6.9% interest rate His credit card with a 19.7% interest rate His private student loans with an 11.8% interest rate His Federal student loans with a 3.76% interest rate " Which debt should Hudson prioritize paying down most quickly using his increased pay to minimize the amount of interest he'll pay over the lifetime of his debts? A) His car loan with a 6.9% interest rate B) His credit card with a 19.7% interest rate C) His private student loans with an 11.8% interest rate D) His Federal student loans with a 3.76% interest rate

Answer 1

B) His credit card with a 19.7% interest rate