If you are struggling to figure out whether you should tackle big debt or small debt first, remember that it really comes down to your personality and motivations. If you are motivated by small wins, studies have shown that paying off small debts often leaves people feeling more accomplished — and more likely to keep up with a repayment program that eventually clears all their outstanding balances. On the other hand, paying off big debt is more cost-efficient in the long run. The larger your outstanding balance, the more interest it’s generating; so, by paying off the bigger debt, you will save on interest, and you will free up funds for other expenses.