<title>Learn about the Debt Reduction Planner</title>
<category>debtplan</category>
<klink type="cncpt">Tell me about the Debt Reduction Planner</klink>
</index>
<content>
<p>The Debt Reduction Planner encourages you to:</p>
<ul>
<li>Pay off your highest-interest <glossary>debt</glossary> first (typically, credit card debt).</li>
<li>Pay the minimum monthly payment on all other debts.</li>
<li>Start paying off your second highest-interest debt next.</li>
<li>Make an extra payment toward your debt whenever possible.</li>
<li>Continue in this fashion until all your high-interest debt is paid off.</li>
</ul>
<p>Most people enter only high-interest debt in the Debt Reduction Planner. Some experts recommend paying off low-interest, deductible debt, such as a home mortgage, on its regular payment schedule if you can earn a higher rate of return on your investments than the interest rate on the loan. However, your goals may vary depending on the amount of time until you retire, your tax situation, and other factors.</p>
<p>After you create a <glossary tNum="288838">debt reduction plan</glossary>, you can see an overview of your debt on the <emph>Loans & Debt</emph> page in the Lifetime Planner.</p>
