DEVOUR YOUR DEBT
Make list of all debts, including the payment amounts. Now you’re ready to apply a simple yet effective, strategy to begin to wipeout your debt.
The technique outlined here is often called “snowballing,” but we call it “Devouring Debt.” Here’s how it works.
People often pay a little extra on each bill because it makes them feel better knowing they paid more than the minimum amount. The problem is that you may still not be making a difference whatsoever toward paying down the overall debt.
Try this instead. It’s as easy as 1-2-3:
1. Take your list of current debts and put them in order based on the balance owed from smallest to largest.
2. Instead of paying extra on one of your larger debts, if possible, use that money to pay off the smallest debt on your list.
3. Continue each month to eliminate the next smallest debt and so on. Add the eliminated payment to the next lowest balance.
The Devour Debt technique does start off slowly; however, it gains momentum and the advantages are immediate. It can be applied to your debt whether you have three credit cards or 10 major loans. It works with any type of debt: medical bills, or car or home repairs.
FOOD FOR THOUGHT
If the Devour Debt technique is to work, you must do two things:
1. Believe it’s possible. If you go into this with the attitude that you’ll never get out of debt, you’re defeated before you even start. Your belief in yourself and your commitment to become debt free will allow you to face down challenges and enjoy victories along the way.
2. Make the commitment to stop borrowing money and using credit cards right now. Getting out of debt requires a slow, steady climb, and every time you give in to that impulse buy you lose ground, so no backsliding. Break the credit habit now.