By Karla Looking towards Heaven | Leave A Comment
Doesn’t that sound wonderful? We all dream about being debt
free. Of not being a slave to our debt. But we don’t know how to get
there. The idea of being debt-free is such an odd thing for most of us.
Debt has become the norm.
According to Bankrate.com, the average household debt, not including mortgages, is $14,500.00. And many families are living paycheck to paycheck.
When that is the case, how do you get out of debt?
You snowball it.
The idea is simple: pay minimum payments on all of your debts except the smallest one. Then attack that one with “gazelle intensity” (That’s Dave Ramsey speak for get rid of it as if everything depends on you getting rid of it).
Every single extra dollar you can get your hands on should be thrown at
the smallest debt until it is gone. Then, you attack the second debt.
Every time you pay off a debt, you take that payment and apply it to
the next debt.
As you keep moving through the debt, paying it off, you have more
money to attack the next debt… then the next… and the next… It
builds up like a snowball.
ABOUT Karla Looking towards Heaven
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THANK YOU! I needed, needed, needed this post. I am now reorganizing all my credit card bills! Your timing on this was incredible.
I have heard this principle before but love the reminder (and the piggy picture!)
Hope your move-in is going well!
JD at Get Rich Slowly had a great link, this week, to an online debt snowball worksheet. Great post!
This is a very do-able tactic! I did this a couple of years ago and am now debt free!
My fiance and I also each put back a $20 bill every Friday so that if we want something big we can pay for it or at least put a good down payment on it with the cash we’re savings. That way we won’t likely be in debt again!