Have you heard of Dave Ramsey’s "Debt Snowball"? It’s a step-by-step plan for getting out of debt. Here’s how it works:
Write your various debts, in ascending order, on a piece of paper.
Take any extra money you have or can make and pay off the lowest balance first, in this case the Gas Card. When you have paid off the Gas Card, take the money you were using to make that monthly payment and—rather than spend it on something else—apply it to the next highest debt on your list, in this case the MasterCard. When you have paid off the MasterCard, take the money you were using to make the monthly Gas Card and MasterCard payments and apply it to the next highest balance on your list (regardless of interest rate or payment). And so on down the list. Before you know it, you’ve got that snowball rolling down the hill and erasing your debt.
This system works because you are taking one step at a time, you are experiencing success along the way, and your successes build upon each other.
Reference: Dave Ramsey, Financial Peace (Revisited) (Viking, 2003), pp. 90-92
|What You Owe|
You owe more than you think. In fact, as of February 4, 2009, you owed $35,562.14 more than you think. If you have a family of four, you owed $142,248.57 as a household.
That’s because, as of February 4, 2009, the ... [Read More]
|If You Owe Money, Be Thankful…|
If you owe money, be thankful you owe it in modern times.
In ancient India and Nepal, creditors would “fast on” their debtors. They would go on a hunger strike at the debtor’s door until the debt was paid. This hum... [Read More]
Reference: Ron Blue and Jeremy White, CPA, Surviving Financial Meltdown: Confident Decisions in an Uncertain World (Tyndale House Publishers, Inc., 2009), p. 75; “Debtors’ Prisons,” en.wikipedia.org; “Marshalsea,” en.wikipedia.org