Debt Repayment: Why is the First Cut Always the Deepest?

I have taken a 5-day weekend off from work and I have been spending that time thoroughly enjoying myself AND spending very little money! These two things, especially in combination, are my favorite!

I have been feeling progressively better about my finances as I make more progress. In fact, every day that passes and every step closer to my financial goals reaffirms that working toward financial wellness has been well worth the effort.   While I still have a long way to go, it finally feels like the ball is rolling, and that this “snowball” I have been working on for so long is finally building. The point is that is took a really long time to get here, even though I still have a long way to go.  So why did it take so long just to feel like I was gaining momentum?

First Cut

I was talking to one of my friends (who is also paying off hefty student loans) about this, and one conclusion we came to is this: the first cut is the deepest. Specifically, we were talking about paying off credit cards. When you begin to read about paying down debt, one of the first things you repeatedly hear is this: pay down your loans in order of highest to lowest interest rate.   For a lot of people (myself included) the highest interest loan you are likely to have is on your credit cards. I myself have two credit cards, both of which hold a bloated 19.99% a.p.r.  This is wild!  This means that my initial balance (before I started paying them down) was causing me to pay 626$ every 3 months JUST in interest! This means I was paying 104.33$ every. single. paycheck. JUST in interest.  I was literally paying this just for them to lend me this money.  Or put more plainly, this was 104.33$ every 2 weeks that was buying me nothing.  This actually made me sick to me stomach when I worked out the calculation just now, so I am very happy that I am on my journey to credit card recovery.

This type of situation exactly is the reason behind the prevalent argument stating that you should always begin by paying down your highest-interest debts first. Beyond adhering to that, you can basically do whatever you want. For me, since both of my credit cards had identical 19.99% interest rates, I chose to start with paying down the smaller of the two in order to create a success experience which would, in turn, motivate me to continue to repay the larger one. This first credit card I started with was maxed out, and had a balance of 4500.00$  While 4500$ is arguably not a huge sum of money, it still took a really long time for me to start making progress on paying it off.   I am now finally only 2 bi-weekly paychecks away from finishing paying it off.

So I will come back to the question: Why did it take so long?  Why was that first cut the deepest?  I have noticed 2 reasons for this in my own journey:

  1. For starters, when you’re paying that much in interest, it’s hard to do anything else.
    • If you figure that I was paying that much in interest every month, and you add those payments to my minimum payments on my student loan, student line of credit, and any living expenses I might have, you quickly realize that I was not left which much for overpayment.  This is one of the hardest things about getting out of hefty, high-interest debt.  The fact of the matter is that these types of debts are designed specifically so that they are very difficult, if not impossible to get out of.  If I had to take the drastic step of moving back in with my parents in order to have the ability to make additional payments above and beyond the minimums.  A lot of people don’t have this option, so their solutions often need to be even more drastic or creative.
  2. The beginning of paying off consumer debts is the period of most drastic behavior change. 
    • If you have managed (like me) to get yourself into this kind of debt, then you have obviously developed unhealthy money habits, or you wouldn’t be here.  When you first begin to pay down those debts, you are on a constant learning curve; creating new behavior and thinking patterns around money, and learning how to build and live this new financially responsible lifestyle.  It follows that this would be a very difficult part of the struggle, because everything is new, and really, you haven’t figured out quite what you are doing yet.  I find that I am constantly learning as I move forward in my journey toward debt repayment, and that the more I learn, the easier it becomes.  The longer practice my new financial behaviors, the more they become my natural habits.  The more times I fall down and have setbacks, the more new things I learn from those experiences.  The things I learn from every success and failure I experience on this journey help to increase my momentum little bit by little bit.


Overall, at this moment I am appreciating the struggles and the successes for what I have learned so far.  I hope to keep my mind open so that I can continue to learn from the failures I will inevitably encounter, and from the successes I will have.  I am excited for the knowledge I will continue to gain from this struggle, and for the continued momentum toward freedom from debt!

As always, thank you so much for reading.

Debt Dummy


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