Three Popular Techniques For Paying Off Debts
Wednesday, July 1st, 2009Three Popular Techniques For Paying Off Debts
By: Michael Redbourn
The web is awash with articles and systems that claim to help people pay off their debts, but only three systems are widely used, and one of them is far more effective than the others.
Constant Payments On Every Account.
This is the simplest method and is perhaps the one that used by most people who bother to use any system at all, but it’s not very financially effective, and is not recommended.
Using the constant payments method, you keep making the same payments every month regardless of the amount that’s requested.
To demonstrate why this method is not monetarily very efficient, let’s imagine a card with a balance of $4,500 and an interest rate of 15%, which would mean payments of approximately $180 per month, and a second card with a balance of $6,700 at 18% interest, and a minimum monthly payment of $268.
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