In the long-game of financial goals, the faster you pay off your debt, the better. The reality is, you have a life to live while you work towards paying off your debt. Deciding to pay or save isn’t as simple as a numbers game. Here’s how to determine which debts to sideline and which to prioritize.

When To Take Care Of Debt First

The debts with the highest interest rates take priority. These are the ones that can take a serious bite out of your long-term financial goals if you aren’t careful. I’m sure you’ve heard the saying “a penny saved is a penny earned.” The same rule applies to debts that have hefty interest rates.

A credit card debt that’s racking up 15%-20% in interest every month is the same as earning 15%-20% more per month. That’s too much of a monetary loss. Taking care of it now will allow you to meet your long-term goals faster.

When To Pay Yourself First

Life is happening right now! You don’t want feel like a slave to your debts if you can help it. You also need to watch your own back in case of financial emergencies. For traditional debt like student loans and mortgages, you may as well stick to the minimum payments and look out for numero uno.

Making extra payments on your mortgage will save you some money in the long run, but it won’t cause your lender to recalculate monthly payments.

Pay It Off As Soon As You Comfortably Can

When you’re finally rolling in the dough, pay off those debts as soon as you can. Don’t worry about losing the tax deduction from tax-deductible debt. The amount you pay in interest is likely much higher than the amount you deduct from taxes.

Strategically paying off debt comes down to balancing your day-to-day needs with lifelong plans. If retirement is closing in, throw as much money as you can into your employer’s matching 401K. As long as you’re out-earning the amount you pay in interest from your debt, you’re golden.