Why I Need Discipline At Snowball Pay My Debts With A Snowballing Technique

1707 Words7 Pages
4 - Paying Off Your Debts With A Snowballing Technique

Some call it a snowballing technique and others a positive-feedback loop, but it basically means paying off your debts. The trouble is that this technique uses a little bit of budgeting (which is tough), and you will need a fair amount of discipline to pull it off.

Why Will I Need Discipline To Snowball-Pay My Debts

The reason is that as the money builds up in your account--it starts to look awfully tempting. It grows and grows in your account on things such as your credit cards, and after a while, you start thinking about a new computer or an upgrade to your car, then you convince yourself you “need” whatever it is you want to buy, you justify it in your head, you spend the money--and you are back to square one. You need discipline to be able to stay away from your own money.

It Works Best For Credit Cards

Credit card debt is one of the most crippling kinds of debt because people max out their cards and then pay a large fee every month to cover the interest, but do not actually pay off the debt itself (just the interest). Plus, the more debt you have on your card, then the more mandatory interest you have to pay every month.

An Example With Three Credit Cards

This technique can work well with other types of debt, but for the sake of the example, it is shown here with three credit cards. All three cards are fictitious with fictitious names and all have been maxed out.

Card Janeway - $2000 debt $60 interest

More about Why I Need Discipline At Snowball Pay My Debts With A Snowballing Technique

Get Access