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Second, we tried to live frugally, and we paid as much as absolutely possible each month to the credit cards (there were 3 to begin with, totalling approx. $22,000). I started with the one with the highest interest rate and paid as much as possible to it, while paying the minimums on the other two. Once it was paid for, I started paying as much as possible to the one with the next highest interest rate, while paying the minimum on the third and final one. Once the second one was paid for, we started paying on the third one, i.e., the one with the lowest rate (9.90%), and that is the debt we have remaining.

I think this 'snowball' effect combined with LBYM ("live frugally") is under-valued by most people who have never done it (kind of like compound interest).

About a year ago, my wife and I budgeted to pay off our CC debt within 18 months. It worked out to about $1200/month (or about 25% of our take home pay), which made things a bit tight at times, but that was the 'budget'. Paying off a card, then rolling those funds to the next card causes the balanced to drop fast on your 'target' card. Also as you eliminate cards, you have more funds going to individual cards. EX: You have four cards, each with $1000 on at 18%, 16%, 14%, and 12% respectively. Say they all have minimum's of $20. With a $200 budget, you would apply $20 to each of the three lower interest cards and $140 to the highest interest card. Once card one is paid off, you are now paying $160 on card two ($140 from card one + $20 you were already paying). Then $180, etc. Combinded with less money being eaten by 'finance charges' (because you've paid off your higher interest cards first), before you know it you're out of debt :)

This is something people who see a mountain of debt in front of them really need to realize. It's not as hard as it looks, especially if you are diciplined.

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