Dr. Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:

"I sure can, and it's actually fairly simple. The rule of thumb you want to use is always to put your money where the interest rate is highest. Let me give you an example, let's say you have a credit card and you have loans on that credit card charging you 18 percent. Let's say you have a car loan that's charging you 2 percent, and then thirdly, let's say you can earn 5 percent by investing your money. Well, what do you want to do? Well, what you want to do first if you have any spare cash, obviously, is put that money toward paying down the credit card rate. That card is charging you 18 percent, and for every dollar you pay down, it's like earning 18 percent on your money. Now secondly, if you did that, and you're left with a car loan of 2 percent and earning money at 5 percent, you actually would not want to pay off the car loan because you're better off taking any spare dollars earning 5 percent, which is higher than 2 percent you would effectively earn by paying down on the car loan. Now, there's one addendum to this, and that is that you never want to carry on any kind of loan debt on an asset or some kind of purchase that has a very short life. So, for example, if you have debt on restaurant bills, you do want to pay those off because you don't want to carry debt on something that you've already used up."