Day 40 of 90 · STRENGTHEN · Week 6: Understand Your Debt
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Why the Interest Rate Matters Most
Understand the real price of carrying a balance.
About 6 minutes
Learn
The interest rate is the annual price of borrowing. A balance at a high rate costs meaningfully more per month than the same balance at a low one.
This is why two people with identical debt totals can be in completely different situations.
Rates also explain why minimum payments can feel endless: much of the payment covers interest, not balance.
Do
Sort your inventory by interest rate and note your highest-rate debt.
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Total balance
$0
Total minimums
$0
Highest rate
—
Smallest balance
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Think About It
What is the gap between your highest and lowest interest rate?
Optional — no answer needed to continue
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