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Paying Off Debt With The Avalanche Method

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Paying Off Debt With The Avalanche Method.

Paying Off Debt With The Avalanche Method Bright Day Finance

It’s really easy to get into debt but it’s not so easy to get out of debt.

Credit cards especially have very high Interest rates so if you are just paying the minimum payments every month then it’s going to take a long time to pay off your debt.

One Method to clear credit card debt faster is called the Avalanche Method. 

Using the debt avalanche method, you pay your debts from highest interest rate to lowest interest rate, regardless of balance.

Mathematically this makes the most sense. You will pay less in interest if you tackle your debts in this order. Saving money on interest means you will pay your debts off faster.

First off all you need to make sure you can afford to pay more than the minimum payments for this method to work as you don’t want to fall behind with your household bills and you also need to make sure you have enough money for food and essentials.

Sit down and write down all your monthly income and all of your expenditure items (anything you pay out for every month). Take your income and minus off all your expenditure items/expenses, this figure is the monthly amount to have to pay you my debts off.

So if you have extra money left over from this figure after you have paid the minimum payments to your credit cards then you will pay this extra amount to the credit card with the highest interest first.

For example, if it’s an extra €200 a month then that will make a big difference to paying your credit card with highest interest as you will be reducing down the interest every month. This method will reduce down the monthly interest amount and you will be bringing down the balance faster also.

When you have paid this card off you will be able to then put the extra money towards your second card with the highest interest and you then work your way through the rest of your credit cards paying the extra amount you have to the next card, so as you pay each card off the extra amount you have will be increasing also. 

This method will only work if you stop spending on the credit cards so make sure you cut up all your credit cards and don’t use them anymore.  

If the amount you have left over after your expenses/expenditure items are taken away from your income is not enough to cover the minimum payments on your credit cards then it would be best for you to receive Free Debt advice from a debt advisor as it maybe the case that you are eligible for a debt solution to help you clear your credit cards with affordable monthly payments and you maybe eligible to have some or all of your debt written off. 

We can arrange a free phone call for you with a debt advisor who will be able to offer you Free Confidential Debt Advice. 

If you are struggling to pay your debts please give us a call on 01 4434125 as we can arrange a Free appointment with a Debt Advisor or Personal Insolvency Practitioner who will offer you Free Debt Advice.

R.McGonnell 30th July 2019

Paying Off Debt With The Avalanche Method Bright Day Finance

Rory McGonnell

Founder of Bright Day Finance

Personal finance expert and blogger who has an interest in money saving ideas.

Tags: Free Debt Advice Ireland, Free Debt Help Ireland, Debt Advice Ireland, Free Debt Advice, Free Debt Help, Credit Card Debt, Credit Card Debt Help, Debt Advisor.

 

 

Laura F. from Athlone

“Bright Day Finance helped me so much, with Rory and his teams help I am now able to manage my debt, and it’s like a weight has been lifted. They even found out I was overpaying on a loan, to which I’m delighted to say Rory sorted for me and I ended up only owing the bank half the amount  so even with just that debt I have saved over a thousand euro.

I can’t praise them enough, it was the best phone call I have ever made, I was in a situation where I was getting deeper and deeper into debt, but was too embarrassed to ask for help. but with Rory and his team they are like the friend you can talk to, they don’t judge! they are here to help you. So if you are in the same situation as I was make that call, it will be the best decision you will ever make”

Chris L. from Galway

“A special thanks to you all and especially to you Rory for being there for me in what was a very stressful time in my life. My debts were spiralling out of control as I struggled to meet the minimum repayments. Since contacting you Rory I have never looked back. You listened and in no time at all I began to feel so much better in myself.

You contacted my creditors and to my amazement they all decided to freeze the interest and charges on my loans. You carefully arranged a debt management plan that works for me and I have one direct debit a month to Bright Day Finance who then pays my seven creditors. It’s been over a year now and everyone is happy. Rory and the team have given me financial freedom and I have a life again”

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