Plan of attack for tackling debt? Help?

[NewbieReed]

I def feel like I need to see some momentum early on - so I will tackle the smallest ones first, then when I get to the items larger than $5K, I will order them by interest rate to save the most money. 

I've been doing some digging on the Dave Ramsey snowball and this other method called an avalanche. Both seem legit. 
Thanks so much for all of your input, everyone. 

At this point I'm just anxious and excited to see a light at the end of the tunnel and have a plan to get there... one day at a time!

[Anonymous]

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@Anonymous wrote:

The way I would do it is make a list of everything you owe with the interest rates and such. Some people feel the need to tackle smaller debt first so they see the quick results (this is me) others want to tackle the highest interest rate first (probably the smarter thing to do long term). My person way of tackling debt is Dave Ramsey's way- pay off the smallest debts first and use the "debt snowball" to tackle the larger debts. My husband however is wanting to switch tactics now that we just have car, student loans, and mortgage and wants to tackle the cars first because of the interest rate- so we are going with that plan for now. 

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Yes, if you have several relatively large, long term debts, attack the highest interest rate first, because thats the one costing you the most dollars.

[NewbieReed]

Agreed! 

I think the only thing stopping me from tackling the higher interest rate first is the human-element, not logic. I feel like i need to get some momentum going before I feel like I am dragging my feet. 

[Anonymous]

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@NewbieReed wrote:

Agreed! 

I think the only thing stopping me from tackling the higher interest rate first is the human-element, not logic. I feel like i need to get some momentum going before I feel like I am dragging my feet. 

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The most effective method is the one you'll use. (Also applies to "diets", exercise, organization, etc. )

[NewbieReed]

Step 1: Asked for Interest rate decrease for both NFCU CC and Discover CC -- accepted by both companies. Hey - every point counts!! NFCU went down to 15.62% from 17.99 and Discover went from 19.99% to 18%. I'll Take it!!!   :::::CHECK::::::

Step 2: Paid off the Walmart  :::::CHECK::::::

Step 3: Ensure all payments are made to all accounts for the month and that there will no issues next month either. Set minimum payments to be paid through ACH/automated systems

Step 4: Use airbnb "extra" money to pay extra $ to Discover. This is my next bill to bring to $0  -hopefully by Dec 2014.

Step 5: Tackle NFCU CC --- even though my MEFA/ACS balance is lower, the NFCU CC is a Credit card, which has more weight with my fico score and it has a waaay higher interest rate. The MEFA/ACS account is an installment loan with a very low payment.  Hopefully by June 2015 - $0.

Step 6: Tackle NFCU Loan (hopefully $0 by January 2016), then I will only have the Lending club loan, JPM Chase car loan, Nelnet loans, and MEFA/ACS loan left over to take on. 

Rent: $850

Utilities/Insurance/Phone/Netflix: $375

Other Living Expenses (gas, groceries, nails): $550

I plan to use my last $1000 a month to tackle these debts. Should I plan for more? Should I still be saving or crushing these debts? Advice? Suggestions? ALL ARE WELCOME!

Debts:

$5676 owed on NFCU CC (17500 limit) - 17.99%  15.62%- Minimum payment $104

 $1944 owed on Discover CC (5500 limit) - 19.99% 18% - Minimum payment $56

$21,700 owed to Lending Club (originally a $22K loan) - 18.24% - Minimum payment $562 

$8283 owed to NFCU for Personal loan (originally 11K) - 18% - Minimum payment $279

$26793 owed to JPM Chase- Auto loan - 1% - Minimum payment $514

$17000 owed to Nelnet/Dept of Ed - 2%-6% - Deferred while in grad school - Minimum payment after $165

$3043 owed to MEFA/ACS - Minimum payment $38

$750 owed to Walmart (1200 limit) - Minimum payment $50 102014

800 owed to Rooms to Go (1400 limit) PAID OFF 10/2014

0 owed to Chase Freedom (5500 limit)

0 owed to Chase United (5500 limit)

0 owed to VS (1000 limit)

0 owed to Ny & CO (1500 limit)

0 owed on AMEX (NSP)

[ricopanorama]

undebt.it is a great website to learn about the different ways to attack debt. It is totally free. I have been using it since I started my rebuilding and it has been perfect for me.

Just put in your balances, mo payment, interest% and you can compare snowball, avalanche, highest mo payment first, or any order you want to see when you will be debt free and how much $interest  you will pay for each method.

I agree avalanche is the smartest but snowball usually give the quickest initial results. I'm using my own method to snowball CC before loans.

[NewbieReed]

@ricopanorama

That site is wonderful!!

although its very depressing to look at how much u owe and how long itll take to pay it oiff- incredibly informative. Thank u!!

[ricopanorama]

You're welcome...I'm glad you found it as useful as I did. And you are right, it is kind of depressing to see how long it takes but I can't wait to see that snowball get so big that it buries a few debts.