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Why the debt snowball was more effective for me than the avalanche method

Updated: Feb 5, 2021

While there are many techniques used for getting out of debt, The debt snowball method was most effective for me. The debt snowball method focuses more on the psychological aspect oppose to the mathematical aspect of debt. It is a debt payoff strategy used to payoff debt with your smallest balance to your largest balance regardless of your interest rate.

Many people advise against this method because it can cost you more in interest in the long run. They would rather use the avalanche method which advises you to pay extra money on your highest interest rate to your lowest interest rate, regardless of your balance.

So why do I suggest using the debt snowball method? Well, that's pretty simple. The debt snowball method is much easier and gives you your wins faster. You become excited once you pay off your first debt and then you move on to the next smallest debt. For example: Let's say you have a credit card with a balance of $500 and a monthly minimum payment of $25. (We don't care about the interest on this card.) The first step will be to pay extra on this balance until it is paid in full, while making minimum payments on all other debts. Once paid in full, repeat until all of your debts are paid off.

The avalanche method could take you longer because it usually has a larger balance with the highest interest rate. This method is way more confusing and can take more time. I am more of a visual person so I get a sense of excitement when I see my progress. With the debt snowball method you get this rewarding feeling, which motivates you to continue paying off debt quickly as possible.

I paid off over $20,000 in debt in just a little over a year. Thirteen months to be exact. $16,000 being my auto loan debt. (Which was my highest debt.) By paying off all my other debt I was able to pay an additional $1,000 to my principle. This was the last debt I had and I was determined to get out of this car loan. I paid my car loan off three years before my original loan date. Not only did this save me money on interest, but I received a check of $400 from the dealership. Wow! The debt snowball gave me hope an as a result I am debt free and no longer living paycheck to paycheck. I now save the money that I was paying towards debt.

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