Analyze the difference in interest ratesHaving savings is important, especially when the savings are part of an emergency fund or a hedge against loss of income. But when you also have an outstanding credit card balance or loan, consider whether you're better off using your savings to pay down debt. Whether it makes sense or not is determined by the interest rate you're earning on your savings versus the interest rate you're being charged on your outstanding loan balance. The difference between earning interest and paying it should give you a good indication of where you can get the best return.
Disclaimer: The accuracy of these calculators and applicability to your circumstances is not guaranteed. Calculators are not a guarantee of credit. Results should be discussed with a qualified professional before any product purchases or loan commitments are made.
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