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The Best Way to Pay Off Debt: Which Debt to Pay First & More

Best Way To Pay Off Deb7

It’s common for indebted consumers to hold multiple balances with various creditors. In such a situation, it’s fair to wonder which debt you should prioritize. Here are the basic steps that you should follow:

  1. Stop the Bleeding: This step is crucial, as it includes two important components. First, it’s important to curtail all unnecessary spending in order to devote as much financial firepower as possible to your debt situation. Second, you need to get caught up on minimum payments in order to mitigate the credit score damage that comes with being classified as delinquent.
  2. Attempt to Lower Your Interest Rates: Whether through a balance transfer, debt consolidation or a debt management plan, it’s important that you at least try to minimize the finance charges that you pay and thereby ease your path to debt freedom.
  3. Build an Emergency Fund: Without an emergency fund of at least a couple months’ take-home, even if you pay off all of your balances you’ll only be a lay off or market crash away from ending up right back where you started – mired in debt.
  4. Pay Off Your Highest-Rate Balances First: Some people will recommend focusing on your smallest balances, but getting rid of your most expensive debt first will save you both money and time.
  5. Explore Other Debt Solutions (If Necessary): If scrimping and saving aren’t enough to get you out of the hole, you may need to look into other options like debt settlement or even bankruptcy.

Now that you know the general roadmap to debt freedom, let’s take a closer look at each of these objectives. Afterward, make sure to check out our Ask The Experts Section for additional insights into how to get out of debt and stay out for good.

2016 Discover Secured Credit Card Review – CardHub

Discover Secured Credit Card Review

The Verdict: The Discover it Secured Credit Card is the it family’s credit-(re)building specialist, and it’s superb at the task.

That’s because it’s one of only 11 “bad credit” credit cards with no annual, monthly or processing fees and one of only nine that offer rewards. You’ll earn 2% cash back on the first $1,000 that you spend at restaurants and gas stations each quarter as well as 1% on everything else. Better still, Discover will double whatever rewards you rack up during the first year your account is open.

2016 JetBlue Credit Card Review – CardHub Editors

JetBlue Credit Card Review

Rating: 513.63.6 / 5

The Verdict: JetBlue is 2016’s second-best airline in terms of operations and amenities — tops in terms of comfort — and its rewards program, TrueBlue, was also named 2016’s best for frequent flyers by CardHub. But it’s important to recognize that such accolades don’t guarantee quality plastic.

Black Card Review – CardHub Editors

Black Card Review

Rating: 511.51.5 / 5

The Verdict: Will the real Black Card please stand up? A role call is needed in light of how slang is being manipulated to cost consumers money. The truth is the real Black Card that celebrities flash and rappers namedrop doesn’t even have “Black” in its name. That’s actually the American Express Centurion Card, and it’s available on an invitation-only basis to extremely high-spenders.

2016 Citi Secured Credit Card Review – CardHub Editors

Citi Secured Credit Card Review

Rating: 513.43.4 / 5

The Verdict: Placing a deposit on the Citi Secured MasterCard Credit Card is neither an outright mistake nor an ideal decision. You see, it’s a solid credit-building tool with the potential to help you reach a higher credit tier for only $25, as long as you use it responsibly. But that’s $25 more than what certain competing secured cards charge.

2016 PayPal Prepaid MasterCard Review – CardHub Editors

PayPal Prepaid MasterCard Review

Rating: 5122 / 5

The Verdict: Prepaid cards are basically newfangled checking accounts minus the checkbook. And given that PayPal bills itself as “new money,” you’d think the PayPal Prepaid MasterCard would be a perfect fit. But that would certainly be an overstatement.

2016 REI Credit Card Review – CardHub Editors

REI Credit Card Review

Rating: 514.54.5 / 5

The Verdict: If you shop at REI and have good or excellent credit, waste no time in adding the REI MasterCard Credit Card to your payment arsenal.

2016 Wells Fargo Secured Credit Card Review – CardHub

Wells Fargo Secured Credit Card Review

Rating: 513.53.5 / 5

The Verdict: A secured credit card is the best tool for building or rebuilding credit at the lowest possible cost. And though the Wells Fargo Secured Visa Credit Card isn’t the absolute cheapest card of its kind, it’s in the conversation.

2016 Victoria’s Secret Credit Card Review – CardHub

Victoria's Secret Credit Card Review

Rating: 5155 / 5

The Verdict: Just between you and me, the Victoria’s Secret Angel Credit Card is the best way to buy bras. Sure, I’m no lingerie expert, but I do know credit cards. Earning what equates to 12% cash back and paying nothing for shipping in the bra category is pretty huge.

2016 Sam’s Club Credit Card Review – CardHub Editors

Sam's Club Credit Card Review

Rating: 5144 / 5

The Verdict: If you drive to work and have good credit — you can find out for free at WalletHub — you should strongly consider applying for the Sam’s Club Credit Card. Interestingly enough, it doesn’t really matter whether you shop at Sam’s Club, as long as you have a membership. The card gives you 5% cash back on the first $6,000 in gas that you buy each year (1% after that), in addition to 3% cash back on travel and dining and 1% cash back on everything else (including Sam’s Club purchases). This card’s connection to Sam’s Club thus is clearly minimal beyond its name.

2016 Milestone Credit Card Review – CardHub Editors

Milestone Credit Card Review

Rating: 5133 / 5

The Verdict: The problems that destroyed your credit standing and are now fueling your search for an unsecured credit card likely don’t represent milestones that you’d care to remember for too long. But the Milestone Gold MasterCard Credit Card is a bit different, as opening it could prove to be an important turning point in your credit comeback.

2016 First Premier Bank Credit Card Review

First Premier Bank Credit Card Review

Note: Our editorial staff maintains strict independence and integrity, so it is important to note that CardHub’s legal history with First Premier had absolutely no bearing on my review.

Rating: 5111 / 5

2016 Verve Credit Card Review – CardHub Editors

Verve Credit Card

Rating: 5111 / 5

The Verdict: Although its unique name connotes youth and perhaps even fun, the Verve MasterCard Credit Card, offered in collaboration by Mid-America Bank & Trust and Continental Finance, actually has the potential to combine the worst of both the secured- and unsecured-for-bad-credit worlds. You see, the Verve Card charges the burdensome fees for which “unsecured credit cards for people with bad credit” are known: $125 the first year and $216 each year thereafter. Yet it may require a security deposit of at least $50 and can be fully secured (which means your deposit and credit line would be equal). In other words, if you’re deemed not to be creditworthy enough, you may not receive any spending power without effectively prepaying for it.

2016 Nordstrom Credit Card Review – CardHub Editors

Nordstrom Credit Card Review

Rating: 513.63.6 / 5

The Verdict: Like most major retailers, Nordstrom offers two credit cards: one that can be used to make only Nordstrom purchases and another that works pretty much anywhere plastic is accepted. However, you cannot simply choose the version you want and apply for it directly. All applicants are first considered for the more restrictive version, the Nordstrom Retail Credit Card, whereas those with good credit and “who make frequent purchases at Nordstrom,” according to the store’s website, are offered an upgrade to the Nordstrom Rewards Visa Signature Credit Card.

2016 Sears Credit Card Review – CardHub Editors

Sears Credit Card Review
Rating: 511.61.6 / 5

The Verdict: Sears, a nationwide retailer perhaps best known for its appliances and a shrinking store count, appears to have already thrown in the towel as far as its eponymous credit cards are concerned. Neither the Sears MasterCard Credit Card nor the Sears Store Credit Card charges an annual fee, but that’s pretty much the best thing going for both.

2016 Macy’s Credit Card Review – CardHub Editors

Macy's Credit Card Review

Rating: 5133 / 5

The Verdict: Macy’s offers two credit cards — an Amex and a store card — but in an unusual twist, applications for the version capable of making purchases anywhere (Amex) must be submitted in person at a Macy’s location. We nevertheless recommend making that trek if your credit score is good or excellent. You see, the Macy’s American Express Credit Card requires better credit for approval than the Macy’s Store Credit Card, but it also offers better ongoing perks that ensure your plastic will be rewarding beyond the first purchase, even if you use it only at Macy’s.

2016’s Amazon Store Card Review – CardHub’s Editors

Amazon Store Card Review

Rating: 5155 / 5

The Verdict: It all comes down to your credit standing and whether you’re willing to pay $99 a year for Amazon Prime. If you’re not already a member or you’re unwilling to join, stop reading and instead consider the Credit Card. The store-only version won’t give you anything but a $10 gift certificate.

CardHub’s 2016 EMV Adoption Survey

EMV ADOPTIONMost people’s first introduction to, and perhaps only interaction with, EMV payment technology has come at the mailbox, not the checkout counter, arriving in the form of an unexpected replacement credit card with a curious, shiny computer chip embedded within it. You see, financial institutions have been fairly responsive to the October 1, 2015 deadline set by Visa and MasterCard for the transition away from magnetic-stripe card security – the backbone of U.S. domestic payment processing since the ‘70s.

The retailer response, however, has been shockingly muted by comparison, which is problematic considering merchants that do not implement EMV-compliant payment terminals are now liable for fraudulent purchases made in their stores. And the roughly $8 billion in fraudulent card purchases made in the U.S. each year certainly represents a mountain of risk for resistant retailers.

2016 Capital One Journey Card Review – CardHub Editors

Capital One Journey Card Review

Rating: 5155 / 5

The Verdict: This is a journey into the world of college credit. No, not the type of credit that’s reflected by a GPA or that culminates in a degree, but rather one that contributes to your money-borrowing history and credit score, thus dictating your financial options following graduation.

Pay Taxes with a Credit Card: Pros & Cons


The IRS does indeed accept payment by plastic, which inevitably tempts many people to ponder paying their taxes with a credit card. There are various arguments to be made both in favor of and against such a strategy, and we’ll do our best to lay them out below.


  • Buy Yourself Some Time: Paying your taxes with a credit card is one way to buy yourself some extra time in order to come up with the cash needed to pay off Uncle Sam. It is important to note, however, that your credit line is not the only such tool at your disposal .

    The IRS offers a number of options to people who cannot pay their full tax burden by the deadline, including a 120-day extension and an installment plan. It is very important that you carefully consider each option, including any and all associated costs, in order to determine which would be most advantageous based on your circumstances.

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