Should People With High-Interest Debts Avoid the Debt Snowball? 

If you’re looking for a way to get out of debt fast, you may be considering the debt snowball method to pay off those unpaid balances. 

What’s the debt snowball method?

The debt snowball method is a debt payoff method that focuses on eliminating your smallest balances first. You continue to pay the minimum amounts on your debts to avoid dinging your credit score or accruing late fees, but any leftover cash goes toward your smallest balance. 

Should I use the debt snowball method if I have high-interest debts?

While the debt snowball can be a very effective debt relief tool, it may not be the best fit for high-interest debts. If your debts have high-interest rates, you may want to instead follow the debt avalanche method.

Other debt relief options

Balance transfers

With a balance transfer, you’ll place your existing credit card balances on a new card that has a 0% APR introductory promotional offer. You’ll work on paying off your debt during this period. 

Debt consolidation loans

With a debt consolidation loan, you’ll take out a new loan to pay off your existing balances. Debt consolidation loans often have lower interest rates than credit cards, so you’ll be able to save cash as you pay off your debt. 

Debt management plans

With a debt management plan, you’ll work with a nonprofit credit agency to roll your existing debts into one monthly payment and reduce your interest rate. You’ll have a fixed payment plan that will help you pay off your debt in approximately 3-5 years.  

Swipe up now to read the full post!