Module 6: Debt Management

Master Debt Repayment Strategy

Understanding Debt

Key Concepts

  • Principal
  • Interest Rate (APR)
  • Minimum Payments
  • Total Balance

Types of Debt

Credit Cards 💳

High APR (20%)

Student Loans 🎓

Lower APR (5%)

Personal Loans 🏦

Medium APR (10%)

DTI Ratio

What is DTI?

Debt-to-Income Ratio:

  • Monthly Debt / Monthly Income
  • Keep below 36%
  • Lower is better

Repayment Methods

Avalanche Method

Target highest APR first

Snowball Method

Target smallest balance first

Level 6 Challenge

Monthly Budget: $2000

  • Credit Card: Min $200
  • Student Loan: Min $150
  • Personal Loan: Min $300
  • Keep DTI below 30%

Start Managing Debt

Ready to tackle your debts?

Start Level 6 →