As the year comes to an end, it is common to reflect on the past year, both triumphs and failures, and resolve to improve in the New Year. Making these New Year’s resolutions is a time-honored tradition around the world.
In 2019, some of the most popular resolutions were to eat healthier, exercise more, lose weight, save more/spend less, and learn a new skill. As expected, many people aim to improve their finances but it is also listed as one of the top five most commonly failed resolutions. Why? Inc.com reports that New Year’s resolutions don’t work because they are vague and unrealistic.
Paying off debt is no easy task. It can be hard to determine where to start and difficult to recognize progress. If you’re resolving to take control of your debt, it’s time to take a more strategic approach this year.
The Snowball Method
The Snowball Method is an excellent way to better manage your finances over time. It is a debt-repayment strategy that focuses on paying off your smallest balances first. The snowball method was originally made popular by personal finance expert Dave Ramsey.
How to follow the Snowball Method
Basically, you pay off your debt in order of smallest to largest, gaining momentum as you pay out each balance. It can be broken down into four simple steps:
- List your debts from smallest to largest regardless of the interest rate.
- Make minimum payments on all your debts except the smallest.
- Pay as much as possible on your smallest debt.
- Repeat until each debt is paid in full.
Why the Snowball Method is successful
Ramsey explains that the snowball method is successful because “it’s all about behavior modification, not math. When it all boils down, hope has more to do with this equation than math ever will.” With this debt management strategy, you see results fast, which gives you a confidence boost. As debts disappear, you become more motivated to continue paying off debt!
Take your New Year’s resolution to pay off or manage your debt seriously with the Snowball Method. It’s an easy first step in the right direction.
How Tolar & Tolar can help
If your debt is unmanageable, the attorneys at Tolar & Tolar are here for you. We will help you evaluate financing options, stop repossession, and get the interest rate down to a manageable amount. We never want to see anyone lose their car or other assets, so we do everything we can to help prevent that from happening. We can help you file for Chapter 7 or Chapter 13 bankruptcy. We value the things that matter most to you.
Learn more about the Snowball Method with Tolar & Tolar Attorneys at Law
At Tolar & Tolar Attorneys at Law, we have years of experience helping other people get themselves back on track – giving them a new and brighter economic outlook. We would appreciate the opportunity to do the same for you. Let our family help your family!
Serving people in Millbrook, Auburn, Prattville, and Tallassee, we are your local solution to make the tough times easier. Contact us today to set up your free consultation!