Buried Alive: digging yourself outta debt (step 5)

help!

Taphephobia- the fear of being buried alive

Previous Steps: Step 1, Step 2, Step 3, Step 4

Step 5- Method

You’ll need to make a plan to attack your debt, unless you just want to blindly pay here and there. One method is the Debt Snowball made famous by Dave Ramsey.

His method involves paying off debt from smallest to largest. You then add the money you were paying on the debt you’ve paid off to the next smallest and so forth. That method works great for people who need to see quicker rewards.

But, there is a downside—you’ll most likely end up paying more money towards debt elimination. Another method (which I favor) is to tackle your debt with the largest interest rate first. Then you work your way down to the smallest interest rate; that way you’re paying less in interest.

It all depends on which works best for you and depending on your debt, using the Debt Snowball might not cost too much more.

Actions to take:

Consider your options for pay-down methods

Create your pay-down plan by listing your debts from either smallest amount or highest interest rate

 

After completing this 5th step, I’d say you’re at 50% of digging yourself outta debt (assuming you’ve completed all the other steps). Congrats! You’re really doing this; there is a light at the end of the tunnel. :-)  Want to gain another 10%…look for Step 6 coming soon.

Image Credit: http://www.flickr.com/photos/rakka/1628979772/

About Jen Perkins

Likes: saving money, being debt free (aside from our house), zombies, travel, getting money, blogging and dogs. Dislikes: debt, being broke, bunnies, wasting money, not having enough money to travel the world and paying interest. Facebook  ♥  Twitter  ♥  Google+  ♥  RSS

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