STEPS TO PAYING OFF CREDIT CARDS DEBT... STEP #3
Pay it Down.
Contact your creditor to negotiate a lower interest rate on all of your credit cards. When you're ready to start putting extra cash toward your depts, even $5 extra helps, focus on paying off the card with the highest interest rate first. Once that card is at a zero balance, take the monthly amount you were paying and apply that to the credit card with the next highest interest rate. this tactic guarantees you will spending less money on interest and pay off your debts faster.
Good point...however if one card/debt has really high interest, it seems that less money would be eaten up if that one was paid off first.
Quoting lillybug222:
Personally, I don't know that it matters so long as there is a long term commitment & follow-through.
Quoting Kelly913:
I see the logic in that approach but have always wondered about getting rid of the highest interest one first too.
Quoting ReesesPieces:
We paid them off based on balance - smallest to largest. We got quick wins that way and it kept us motivated to keep going.
Some Things Cookin' at my blog!
Quoting Kelly913:Good point...however if one card/debt has really high interest, it seems that less money would be eaten up if that one was paid off first.
Quoting lillybug222:
Personally, I don't know that it matters so long as there is a long term commitment & follow-through.
Quoting Kelly913:
I see the logic in that approach but have always wondered about getting rid of the highest interest one first too.
Quoting ReesesPieces:
We paid them off based on balance - smallest to largest. We got quick wins that way and it kept us motivated to keep going.
Quoting Kelly913:
I see the logic in that approach but have always wondered about getting rid of the highest interest one first too.
Quoting ReesesPieces:
We paid them off based on balance - smallest to largest. We got quick wins that way and it kept us motivated to keep going.
Generally the savings is only a small amount in the long run. As Rhonda said, it can be a matter of making 4 payments long term or 4, then 3, then 2, then 1. It's easier to swallow smaller debts while still working the big one, rather than taking one big one (because in my experience working with people, the highest interest rate card is usually one with a big balance) and trying to pound it into the ground with a few snowflakes as opposed to a snowball.
Also, paying down smallest to largest often helps change behavior because you stick with it and are less likely to get discouraged. It is when people get discouraged, chipping away at a monster debt, that they lose intensity. If they can see fast quick results, they can keep the intensity necessary to work through it.
Your right, whatever extra you can spare will make a difference.
Monthly expenses
- yvonne37
on Jun. 27, 2012 at 12:29 PM