Out of debt by January 2009!
posted in calculator, goal, save money, tips, tools |I read once on Lifehacker about using the snowball calculator to pay off debts. (Or was it at Get Rich Slowly? I don’t know - they both reviewed the same method)
Yup, the Dave Ramsey method.
This works by gathering all your information, and I suggest using this calculator.
- Select your number of debts (mine was 5, currently)
- Setup a minimum amount per month you are willing to devote to this (I chose $1000 - a conservative estimate, really)
- And which way would you prefer to snowball? Interest or balance? - the great thing about this calculator is you can compare them both and see which way you would benefit the most.
Instead of doing it by the “emotional” method of paying the lowest off, I’m doing it by interest rate - I stand to save more money that way (~$200 in the long run). Of course, this is assuming I’m not going to have any purchases made, any increase of debt, or any changes in income - no doubt with a baby on the way the changes will be coming - and when my wife and I get a house purchase in order - the mortgage actually shouldn’t affect this plan - I’m establishing this as if we are all ready paying on the mortgage.
Has anyone else used this method? What are your experiences with it?
