Wrangle your debt with the Debt Lasso
You’ve heard of the Avalanche and the Snowball methods for paying off debt. But, you haven’t heard of the Debt Lasso to pay off credit card debt fast.
Why we made the Debt Lasso
When we were paying off our credit card debt, we saw that we could pay off our debt faster with our own strategy, now the Debt Lasso, then either the Avalanche or Snowball methods.
Hear about how the Debt Lasso will help you pay off credit card debt fast:
Topics covered about the Debt Lasso
The Avalanche Method
- The Avalanche Method says to pay off your highest interest rate debt first while making minimum payments on our other debts. Then, pay your next highest interest rate debt off with the additional money with which you were paying your higher interest rate card off, and continue until you’re debt free.
- Prioritizing your costliest debt first is the fastest way to pay off your debt in general and save the most money in interest payments.
The Snowball Method
- The Snowball Method, popularized by Dave Ramsey, says to pay off your debt with the smallest balance first while making minimum payments on your other debts. Once your smaller balances are paid off, pay off your second smallest balance with the additional money with which you were paying your small balance card off and so forth until you’re debt free.
- This is psychological gratification. Even though it might take longer to be debt free and cost you more in interest payments, these quick wins are motivating.
The Debt Lasso Method
- The Debt Lasso Method says to get the interest rates on your debt as low as possible, even 0%, and pay it off as fast as possible using the money you save in interest payments.
- This is how we paid off $51,000 in two and a half years.
- Read more about the Debt Lasso here.
The 6 steps of the Debt Lasso
- Contact all your credit card companies and asked them to lower our interest rates.
- Find 0% interest-rate-credit-card-promotions with no annual fees.
- Read the fine print.
- Crunch the numbers.
- Do a balance transfer when advantageous.
- Put the money you used to pay interest on towards your debt.
Risks of the Debt Lasso
- Be clear about what happens if you miss or are late on payments, what could cause you to no longer qualify for the promotion and what the credit card interest rate will be after the promotion ends.
- Be aware that opening and closing credit cards regularly will cause your credit score to drop. We kept our credit cards with the longest histories open with $0 balances even while we opened and closed our 0% interest-rate-credit-cards. This helped our credit scores not to drop as they otherwise would have.