Highest Interest Method
This is a debt reduction plan whereas you setup a monthly payment plan to pay off the highest interest debts first.
For example lets say you are making monthly
payments of around $100 a month on your highest
interest debt.
Under the highest interest debt reduction plan,
what you would do is add additional money say $150
to your normal monthly payment on your highest
interest debt.
Now you will be paying $250 a month instead of the
normal $100. You would continue to pay that amount
until that high interest debt is paid off.
Repeat the Process Until Your Debts Are Paid In
Full
Go to the next highest interest debt and add the extra $250 a month to your normal monthly payment for that debt. Once that on is paid in full take the amount of money you were paying on the debt you just paid in full and add it to the amount you pay for the next highest interest debt. Continue to make those monthly payment until that bill is paid in full.
Then repeat the process over and over again always adding last debt monthly payment to your normal monthly payment.
Before you realize it you will be on your way to becoming debt free.
Understand This About the Highest Interest Method
- Can be used on any debt but works best on credit card debts
- It will work for anybody but you must have the extra money to put toward the extra monthly payments
- If you don't have extra cash, you can read this to find ways to come up with extra cash to pay down your debt.
- Use this pay off your debt calculator to help you out.
- Avoid using all debts with the highest interest rates.
