Topic: What is your personal debt reduction method aside the debt snowball method? (Read 682 times)

It also depends on the interest rate you need to pay for such loan, for example the interests you need to pay for a mortgage are very low and as such you can afford to take the loan and pay the house in 10 to 20 years, however the interests you need to pay when using a credit card are incredibly high and if you allow your debt to go out of hand then it could take you a great deal of time and money to pay your debts, which at the time you got such debt it was relatively small.

Since we have different jobs, our incomes are probably not the same. The capability of each person to take a loan should be different as well. But I think we must avoid to take a loan that we are difficult to repay the loans. If we earn $100k every year, we mustn't take a loan $220k, how we repay the money? Just take a loan for a very urgent need, don't take a loan excessively. We must think carefully how to repay the loan money before we take the loan. It is a careless way to borrow money without thinking much about the repay.

Considering we all have different amounts of income and different amounts of debt, its not going to be that easy to find that is valid for all of us at the same time. I know that it looks like its possible but its not. If you make 100k a year and have 220k debt, its going to be wildly different from the person who has 10k a year income with 22k debt. Those are very different things not just because the difference in amount, because someone with 1 million a year income with 2.2 million debt could still do exactly what the 100k income one did, but the 10k income one doesn't have excess amount to spare, the other ones does.

The debt snowball method is one of the most recommended strategies to get out of debt. How does it work?

You list your debts from smallest to largest and pay the minimum amount on everything except the smallest one. You prioritize paying off the smallest debt aggressively.

- consider selling off all the items you don't need.
- Consider working more jobs to increase your source income.
- Consider temporarily halting all investment, after which pour all your energy into paying off to the smallest debts.

By paying off the smallest debts first, the snowball effect kicks in and you move on to the next debt on the list until you pay off all of them. It is estimated that a person who follows this method religiously can become debt-free within 18 - 24 months.

However, the debt snowball method may not be effective if you have debts with specific payment dates that, if missed, could result in higher interest rates or a negative impact on your credit score. Nobody wants any of these.

Recently, I had some debts to pay and prioritized them based on urgency, regardless of their size. I had to pay them by or before the deadline. I didn't mind whether they were big debts or small debts. What mattered was meeting up with the deadline. This approach worked for me, although I'm not sure if it falls under the debt snowball method.

For those who have gotten out of debt more quickly, did you use the debt snowball method or another personal debt payment strategy that worked for you over the years?

* www.cashry.com/blog/the-debt-snowball-method-to-help-reduce-your-debt/

* www.citi.com/credit-cards/debt-management/debt-snowball

* www.bankrate.com/personal-finance/debt/debt-snowball/

* www.capitalone.com/learn-grow/money-management/debt-snowball-method/

* www.mamaandmoney.com/debt-snowball/

* www.guidetogreatertampabay.com/2022/06/28/traveling-th...-one-step-at-a-time/

* www.incomebuddies.com/debt-snowball/

* www.houseofdebt.org/debt-snowball-method/

* www.equifax.com/personal/education/debt-management...ent-vs-saving-money/

People does have different mindset when it comes to this on which it is really not that the same on which there are people who are really that irresponsible when it comes into their debts or loans on which

this could really destroy up family or relative relations on which it wouldn't really be that happen because money could break up everything.If you are that minding about such thing then you would really be avoiding on making up conflicts and this is why you would really be paying up those loans in due time because you dont like for those kind of situations you might be ending up. Some are mindful and responsible but there are some people who are really taking up some advantage just because you are a family or close friend or similar to that.

In solving out your debts then snowball method would really be the best, go for small ones and if you do see that you have gradually been  eliminating those loans you do have then
you would really be  that persevere on finishing it all the way.

Right. But with all the lessons we get from the experience of giving loans. So it was from there that I became aware that I personally could not even borrow a loan. when I get a loan of a friend, I will prioritize it and try to repay it according to the promised time. so that my friends and I can continue to build trust and not destroy our relationship. so is the family.

Well, it's true that when we intend to help others, we really try to lighten the burden that he has without expecting profit. Because we will be very happy when someone helps us selflessly.

I agree that giving the loan to our family members or friends makes them have low motivation to pay off on time. I've experienced it, one of my family members take a loan from me and never pay off the loan for years. It is true that the situation makes me lose my trust in him, and I become more careful to lend money to other family members or friends.

Sure, since it is for family members or friends, we shouldn't take an interest. Even if it is for other people, I try to lend them with no interest. I don't want to be like banks, the main purpose is to help other people. I always believe that helping people shouldn't expect interest since it is not the proper way to earn money from people with financial difficulties.

Getting loans from family or relatives and friends sometimes makes us a little complacent and less burdened. But this can make us lack motivation to pay off loans. and yes it can create enemies and create rifts in our relationship with relatives. And actually if there are families who want to lend us money without interest then that's a fortune. because of the current situation, it is sometimes difficult for even family or friends to trust each other in lending money. But I personally also give loans to friends and family quite often, but luckily my family and friends always pay on time according to the agreement. And avoiding interest is what we have to do because with interest-bearing loans it will only make it more difficult for us to pay off because we have to pay off the principal loan along with the interest.

Lacking the motivation to pay our debt is a sign of being irresponsible. No matter how big or small our debt is, once someone lends us funds when we need it is already something that we should be grateful for. It means that they trust us that we could pay their money on our promised time so no matter what our situation is, we should always be motivated to pay them back because if we ruin their trust, we'll never have anyone to run to in the future in case we need their help again.
Lacking motivation and courage to pay our debt shouldn't be an excuse. We should be as well determined as we are when we're borrowing funds from lenders. After repaying them, as much as possible, we should try our best to avoid borrowing and try to manage our finances wisely so we'll never experience a financial shortage because if we'll keep on borrowing, the cycle of our struggles with just continue.

Lacking the motivation to pay our debt is a sign of being irresponsible. No matter how big or small our debt is, once someone lends us funds when we need it is already something that we should be grateful for. It means that they trust us that we could pay their money on our promised time so no matter what our situation is, we should always be motivated to pay them back because if we ruin their trust, we'll never have anyone to run to in the future in case we need their help again.
Lacking motivation and courage to pay our debt shouldn't be an excuse. We should be as well determined as we are when we're borrowing funds from lenders. After repaying them, as much as possible, we should try our best to avoid borrowing and try to manage our finances wisely so we'll never experience a financial shortage because if we'll keep on borrowing, the cycle of our struggles with just continue.

Getting loans from family or relatives and friends sometimes makes us a little complacent and less burdened. But this can make us lack motivation to pay off loans. and yes it can create enemies and create rifts in our relationship with relatives. And actually if there are families who want to lend us money without interest then that's a fortune. because of the current situation, it is sometimes difficult for even family or friends to trust each other in lending money. But I personally also give loans to friends and family quite often, but luckily my family and friends always pay on time according to the agreement. And avoiding interest is what we have to do because with interest-bearing loans it will only make it more difficult for us to pay off because we have to pay off the principal loan along with the interest.

It seems that people are starting to wake up and they are realizing how disadvantageous it is for them to have so many debts, the problem is that even if they make that realization they cannot escape those loans that easily, as in many cases we are talking about debts they wanted to pay decades from now.

So if you are one of the few that is debt-free then you need to take advantage of it, and this can be done by investing whatever spare money you have in assets that you know that will do well over the next years, and without a doubt bitcoin is one of the best assets someone can choose in order to do this.

Here in my country, we don't usually take a loan from a bank but borrowing from someone we know instead to avoid any interest. I believe the snowball method is the most effective one here rather than not paying at all in the certain date you promised to return all the money, or the worst case scenario that could happen is you won't pay the money you borrowed at all because you have no shame since it's either your friend or a relative, and that's how you make enemies.

Difficult economic conditions like now make us have to be good at finding sources of income, many people rely on debt when they have sudden needs so that they have to pay interest, the best solution is when a lot of money then use it for business or investment so that when we have a sudden need we do not rely on debt .