If you enjoyed this article, share it. Thanks for visiting my website.
Debt Snowball Method
This is a debt reduction plan whereas each month you add additional money to the debt with the lowest balance. For example your lowest credit card debt balance is $1000. The usually minimum balance you've been paying per month on this debt is $50.
Under this method, what you would do is add extra
money say $100 to your minimum monthly payment.
Now you will be paying $150 a month instead of the
normal $50. You would continue to pay that amount
until that low balance debt is paid off.
Repeat the Process
Then you go to the next lowest balance debt and
add the $150 to what you are already paying on the
next lowest balance debt.
Once that is paid off you go on to the next lowest
debt always adding the amount you were paying
from the last debt to the current debt.
Repeat the Process Until Your Debts Are Paid In Full
Before you realize it you will be on your way to becoming debt free.
Understand This About Debt Snowball
- Usually is used on credit cards debts but can be used for other types of debt too
- It will work for anybody but you must have the extra money to put toward the extra monthly payments
- If you are short on extra money, you can read this to find ways to come up with extra money to help you reduce your debt.
- You must stop using the credit that you are trying to pay down
- Use this debt reduction calculator to help you out.
Hi, I'm Abbie.
Your financial
education tutor.
Welcome!
