Three Steps to Snowball Debt or Avalanche Debt Payment
- Collect Information About Your Unsecured DebtsFirst, collect information about your debts. Start by getting a free credit report.
- Figure out How Much You Can PayAvoid minimum payments by keeping your payments constant. Even better, pay off your debts more aggressively.
- Snowball, Avalanche, or...?Paying off your debts means sticking to the plan. Some people, such as David Ramsey, suggest that you pay off your lowest balance first. The psychological boost keeps you on track.However, if you start with the highest interest rate, then you are going to save the most money.One other way to pay off your debt quicker and save money is to take out a debt consolidation loan. If you qualify for a low-interest loan (or at least lower than your current debt), then you can save money and optimize your debt payments.Use the Snowball Debt Calculator to find out precisely much you can save.
Pay off Debt Calculator
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Paying off Debt Questions
Can a debt consolidation loan be a better alternative?
A debt consolidation loan can save you money if you have high-interest rates. To get the best rates you need an excellent credit score. However, if your current credit card rates are very high, or you need to consolidate medical and other bills, then a debt consolidation loan might be a good alternative.
What if I can't afford the minimum payments?
Minimum payments are a costly way to pay off your debt. The Debt Payoff (Snowball) Calculator shows how much you pay if you don't reduce your monthly payments.
If you can't afford your minimum payments, then take a serious look at your budget, or try to work out a debt relief program.