Money Talks News: The three steps to destroy debt - News, Weather, Sports, Toledo, OH

Money Talks News: The three steps to destroy debt

(Source: WTOL) (Source: WTOL)
Money Talks News -

It's no wonder two common resolutions are fighting fat and destroying debt. Because both are potentially dangerous. Ask any credit counselor: Too much debt can ruin your life. 

Sometimes you stop performing at work because you're distracted. Sometimes it impedes your family life and causes a lot of conflicts. In fact, 50 percent of divorces in this country, the number one cause is financial pressures.

But there is good news, you can turn that debt to dust with the same system professional credit counselors use.

Step one: Gather all those debts together and see what you got. That includes credit cards, mortgage, car loan. Write it all down, interest rate included. 

Step two: Target one debt for payoff, and bring all your weight to bear on that debt. Make minimum payments on your other debts, but pay extra, as much as you can, on that target debt. 

The more you pay, the sooner that debt is destroyed. Where are you going to find the extra money? You're going to use a budgeting app to see where your money's going now. Then you're going to start using it to see where you can save. Everything you save you're going to apply to that debt. 

When that debt's dust, it's time for step three: Pyramiding.

That's using the payments of dead debts to pay extra on others. For example, say you're paying $200 monthly on your credit card. When you pay it off, add that $200 to your car loan. When the car's paid off, add both old payments to your house payment. 

There you go: Three steps: Rank your debts for payoff.

Squeeze some money out of your budget. Use the power of the pyramid and you're going to destroy those debts without breaking a sweat. For more info and some links, check out the Money Talks News website  and do a search for "Debt." 

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