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Author: aj485 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 309114  
Subject: Re: Saving vs. Paying credit card debt Date: 6/26/2011 11:45 AM
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Welcome. Please realize that that post you replied to is over 14 years old, so the advice you have given hopefully won't be much use to the original poster, assuming they have paid off their debt by now.

I have recently found a resource that taught me a schedule to making the most out of my payments.
Step one :
take your cards and write down the amount you owe.
#2 write the minimum due
#3 divide the amount due by the payment. this will give you a number and a ranking of which you should pay-off first. The lowest number should be first ......
If you can add even $20 to that card each month, while making your other minimum payments, it will speed up the pay-off date.
After paying that card off apply that to card two on your list and so-on.

This is a partial summary of David Bach's 'DOLP' method. http://finishrich.com/dolp/

Depending on the interest rates on each debt, this method can end up costing you more than simply using the same amount of total payments and paying down in interest rate order, from highest to lowest.

David Bach, Dave Ramsey and others who support paying down debt in an order other than highest rate to lowest rate posit that the quicker payoffs of the smaller balances provide motivation that will encourage the debtor to continue paying off their debt. This might be true for some people. However, others will get more motivation by seeing the their total debt drop faster, which is what will happen if the highest interest rate debt is paid down first.

For each individual, the method that will keep them motivated is the best one to choose.

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