How to debt stack your bills

DEBT STACKING
Debt stacking is one of the best ways for someone to eliminate debt quickly. However, it does take discipline. Debt stacking involves gathering your bills together and looking at the following items:

1. Balance
2. Interest Rate
3. Minimum Payment
4. Your Actual Payment

What debt stacking involves is taking any of your actual payments that are higher than your Minimum Payments and applying that money to one bill.

For example, let’s say you have four credit cards that you pay $25 extra on each for a total of $100. What a debt stacking program will do is determine which balance will be paid off first and take the entire $100 to that bill. Important is that you continue to make only the minimum on the rest of the bills.

Oh and one more extremely important note:
ANY CREDIT CARD YOU ARE DEBT STACKING SHOULD NO LONGER BE USED!!!

If you use this credit card debt stacking will not work. My suggestion is keep one credit card with a low balance and high enough limit to pay for any unseen repair, purchase or anything for that matter.
OK back to debt stacking.

You will make your minimum payment plus the additional $100 until that bill is paid off. Let’s say the minimum payment is $30. You would pay $30 + $100 = $130 on the first bill.

Once that bill is paid off take the entire $130 to the next bill on the list and continue until the last bill is paid off. I used this with many clients and some even kept next to their computer so they could review list when paying their bills.

They would just mark one bill off then another. One suggestion I usually give is to reward yourself once you have paid off a bill.

This is especially important for anyone struggling to stay ahead. Like the above example instead of taking the entire $130 to the next bill maybe keep $40 of that money and go to dinner or buy something for your family.

Just like any weight loss program they always tell you to reward yourself so you can appreciate your success. I’ve had families go what I consider “hardcore” by following plan for one year, but never rewarded themselves and then fell back into old spending habits.

I believe this was due to not rewarding themselves since they were still living paycheck to paycheck.

LESSON: Reward yourself when you eliminate a bill.