The best ways to pay off your credit cards

February 8, 2025

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Hector Galicia

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Your credit card debts are keeping you up at night, and the stress of collection calls to your family, friends, and even your job is overwhelming. We invite you to read this article, where we explain two effective methods to pay your debts and regain peace of mind.

The methods avalanche Y snowball are two popular strategies for paying off debt. Each has advantages depending on your financial situation and motivational style.

Debt Avalanche Method

This method focuses on paying off the debt first with the highest interest rate. Here's how it works:

  1. Sort out your debts from highest to lowest interest rate.
  2. Keep paying the minimum in all your debts.
  3. Allocate all the extra money to the debt with the highest interest rate.
  4. Once the first debt is paid, the money you used for her you direct to the next one with greater interest.
  5. Continue until you are debt free.

✅ Advantage: You pay less interest in the long term, saving money.
⚠️ Disadvantage: It may take time to see progress, which could be discouraging if your debts are large.

Debt Snowball Method

This method prioritizes the smaller debt, regardless of the interest rate. Here's how it works:

  1. Sort out your debts from lowest to highest outstanding balance.
  2. Keep paying the minimum in all your debts.
  3. Allocate all the extra money to the smallest debt until it is paid off.
  4. When a debt disappears, use the money you paid on it to attack the next smaller one.
  5. Keep going until you are debt free.

✅ Advantage: Generates quick motivation because you eliminate debts faster.
⚠️ Disadvantage: You pay more interest in the long run if large debts have high rates.

Which method is better?

  • If you like save money on interest, he Avalanche method is the best option.
  • If you need quick motivation to continue with the plan, the snowball method is more effective.

Some people combine both methods, starting with the snowball to gain momentum and then switching to the avalanche to maximize savings.

We invite you to organize your finances. If you need professional help, contact us via WhatsApp or call us. We will be happy to advise you.

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Written by Hector Galicia

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