How to Reduce Credit Card Debt: Four Steps to Taking Control of Your Finances with Debt Stacking

If checking the mailbox is something you dread, it’s time to get control of your finances and your debt.

Here is a proven strategy for debt elimination. It’s called Debt Stacking, and it can work wonders for those who are able to pay the minimums each month and aren’t accumulating new debts, but feel as though the minimum fees and the old balance will just never go away.

Here are the four steps to this debt elimination strategy:

First Step:
Make a list of your debts in order from smallest to largest. When you get to the larger debts, write your high-interest debts (such as your credit card debt) before your lower-interest debts (lines of credit, etc.)

Second Step:
Pay the minimums each month on all credit card bills, and work to pay the smaller bills first. Although these bills might not be the highest interest, when you pay off a debt completely, you will feel empowered, and motivated to continue paying more toward your other debts.

Third Step:
Once you have paid a debt completely, add the fund that you had been sourcing to this debt toward the next debt on your list. For instance, if you are paying $100 to the small debt. Once it is paid off, you will add $100 each month to the payment of the second debt on the your list. Keep rolling the payments forward down your list.
 
Fourth Step:
Once you have paid your debts, take the money that you had been allocating toward your debts through this process and add to your investments and savings each month.

With the debt-stacking debt elimination strategy, you’ll pay less interest and you’ll feel great about being able to do this on your own, without borrowing more money. Plus, you’ll be trained over time to save money, which means more money over the long-term.


About the Author:
Leo J. Quinn, Jr. is a financial educator from the Albany, NY area. For the last eight years he has been stunning audiences by showing them that paying off their highest interest rates debts first and/or paying extra on more than one debt is often the SLOWEST way to get rid of those debts. He has a special offer for Momscape readers here.

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