I recently read that paying off debt is like eating an elephant.
You do it one bite at a time.
But I understand the concept, and its one I can get behind.
What do they mean?
Im glad you asked.
No Interest Til Almost 2027?
Balance Transfer = Credit Card Cheat Code
Whats the Debt Avalanche Method?
This debt reduction method involves paying off credit cards with the highest interest rates first.
It may take a little longer than other methods but check this out.
High-interest cards dig you deeper into your debt hole and make it more difficult to climb out.
The sooner you get them paid off and put away, the better your financial health will be.
How It Works
Lets say you have two credit cards, each with a $5,000 balance.
(In other words, not me.)
Whats the Debt Snowball Method?
So the snowball method could even improve your credit opportunities.
Remember the two imaginary scenarios I gave you in the above example?
(Dont panic, were just pretending.)
But the best method is the one that actually gets you out of debt.
Just pick one and run with it.
it’s possible for you to always change things up if you find its not working for you.
Need some extra motivation to try one of these options?
Here at The Penny Hoarder, weve seen both methods work well in a wide variety of situations.
Lisa McGreevy is a former staff writer at The Penny Hoarder.
(Can you sense my millennial sarcasm there?)
You know which ones were talking about: rent, utilities, cell phone bill, insurance, groceries…