Function

• Paying down debt early will help you save money on interest because credit card interest rates are much higher than those of savings accounts. Paying down credit card debt will also help your credit score because you will have a lower debt-to-credit ratio, according to Bankrate.com.
  
  

Considerations

• Saving money prepares you for emergency situations where cash is vital: job loss, health crisis or property damage. In addition to an emergency fund, saving money is key to planning for retirement. Putting money away when your employer matches your contributions to your retirement fund is a wise decision, according to Bankrate.com.
  
  

Time Frame

• Time frame is an important factor in the decision between saving and paying down debt. If you are far from retirement, it is to your advantage to pay down credit card debt as quickly as possible. However, if you are near retirement age, saving may be the more prudent decision.