Debt Avalanche Helping to Destroy your Debt

Have you heard about the debt avalanche method for getting rid of debt? You may have heard of the debt snowball method. Dave Ramsey is a big proponent of the debt snowball method. 

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Oh debt, why is it a pain?

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Debt is something that people cringe about. It is that financial black spot on your perfect life, and it is oftentimes very hard to get rid of. 

Two Methods Debt Snowball vs Debt Avalanche

There are two methods to get rid of debt. First is the Debt Snowball method. It was popularized by Dave Ramsey. The belief that paying off smaller loans will give you a psychological achievement high pushing forward to trying to knock out more debt. 

Secondly, we have the Debt Avalanche method. You will knock out the highest interest loans first then work your way down to the lowest loans. 

The Debt Snowball Method, step by step:

Step 1 – Add up all of your debt.  List every. single. one.  Be sure to include the total amount owed and minimum monthly payments required for each one. Step 2 – Now list all your debts from smallest to largest.

Step 3 – Make the minimum payments on all debts except the smallest.  Pay extra on the smallest debt, paying as much extra on it each month as you can. Step 4 – Once the smallest debt is paid off, apply the same strategy to the next smallest debt. Continue until all of your debt is paid off.

The Debt Snowball Method, step by step:

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The debt snowball method allows your payments to snowball, so that each debt is paid off faster. After these steps, the person in debt will have a great feeling of knocking off one debt at a time until all the debt is paid off. That is great news!! Who doesn't want to be debt free?

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