Hey! How can a snowball help you become debt free?
If you're using credit cards to finance your way of life and not paying off the balance each month, you're probably paying a lot in interest and penalties.
For instance, paying the $25 minimum on a $1,000 balance will take over four years to pay off and could cost you over $300 in interest alone. So it's in your best interest to pay that balance off as quickly as possible.
That's where the snowball comes in. Snowballing payments means that you pay what you can toward each bill each month, paying off your smallest debt first. Then, take that money and add it to the payments of your next smallest debt. Payments build up, like a snowball, until your largest debt is paid.
The more you can pay on your credit card bills, the faster you’ll be out of debt and the less you’ll ultimately have to pay. For more help on managing your credit card debt, visit southernbank.com/getwell. See you next time on Money Matters!