Your Debt Doesn’t Stand a Snowballs Chance in ….
There are a lot of methodologies when it comes to paying off your debt in the fastest possible fashion. Some of them work on paper, but in a real life setting they can become somewhat complex and difficult to sustain. The Snowball Method of debt payment, in our humble opinion, works extremely well, is easy to follow, and creates real mental and material gains. After all, if it doesn’t feel like you are making a dent in your debt, it’s difficult to continue trying.
So, How Does It Work?
- Start by listing your debts from smallest to biggest
- Pay off the smaller debts as fast as you can.
- Once a debt has been paid off, take that debt payment and apply it to the next debt in addition to the payment you were already making.
- For example: Say you have 3 debts – $500, $300, $100 and you are making the following payments on those debt s each month – $50, $30, $10. Once you pay off the $100 debt, take the $10 debt payment and apply it to the next debt on the list. Now you are paying $40/month on the $300 debt and soon you will be paying $90/month on your $500 debt. Your total debt payments do not go up each month but stay constant.
No, It’s Not Magic…
There’s nothing magical about this method of paying off debt. It’s more of a psychological game because it allows you really see those individual debts disappearing. Just like dieting, if you see the pounds peeling off every time you step on the scale it’s easier to maintain positive momentum.