Having short-term and long-term debt can really cause a strain on your finances. Finding the most efficient way to pay down your debt can be the most overwhelming and frustrating part of the process. There are different ways to strategize how to pay down your debt in the most time-efficient manner so you can start working towards growing your assets and having more financial comfort.

1) PAY DOWN HIGH-INTEREST DEBT FIRST.

2) Pay down or convert non-tax-deductible debt. Pay down all non-tax-deductible debt and try to convert the non-tax deductible to tax-deductible debt. Paying down this type of debt first will save you money in interest costs. With non-tax-deductible debt, you are using after-tax dollars to pay interest, which makes this type of debt more costly.

3) Consolidate debt. Consolidate small high-interest loans (credit card debt) into one loan at a lower interest rate (personal line of credit). Refinancing your debt can free up cash so that funds can be redirected to other goals. A consolidation loan combines all of your debts with varying payment dates and interest rates, into a single debt with a monthly payment date and lower interest rate.

4) Shorten the loan term. Shorten the term of the loan by increasing the amount of the payment or by increasing the frequency of payment. Shortening the term minimizes the cost of the loan because you will be paying less total interest. This option might be difficult depending on your cash flow.