Let’s Talk… Debt Elimination Strategies!
MAY 3RD, 2020
💎 Debt Snowball Method vs. Debt Elimination Method
💎 Debt Snowball Method (DSM)
PROS
With the DSM, there is a psychological benefit of seeing results sooner and that may inspire you to continue on your debt elimination journey. By paying off debts with smaller amounts first, you have multiple short-term wins to celebrate and be proud of.
CONS
It will take longer to pay off your debts because you will be paying more in interest rates over time.
💎 Debt Avalanche Method (DAM)
PROS
With the DAM, you save more money long-term, because you are paying off debts with the highest interest rates first.
CONS
The DAM takes extreme discipline and may be difficult for many people to start their debt elimination journey with this method.
💎 When I started my debt elimination journey, I started with the Debt Snowball Method. This is because I was so overwhelmed with the amount of debt that I had, that I wanted to feel good, feel accomplished about SOMETHING regarding my money! So I used the debt snowball method to have multiple WINS during my journey and to give me motivation to keep going!
💎 I am now using the Debt Avalanche Method. This is so because after paying off $23,000 of debt in 2 years, I have a high sense of accomplishment towards my debt elimination journey. I can now focus on paying off accounts with higher interest rates, to save money in the long run!
💎 Everyone’s debt elimination journey is unique and how I utilized the two methods may not work for you and that’s okay! The point is to just START! Choose a method and just START!
If you’re interested in how to actually apply these methods, or to determine what method is right for you, subscribe to the Own Your Check e-mail list in the footer!