Debt Snowball vs. Debt Avalanche Approach To Paying Down Debt #085
How to Money
iHeartPodcasts
4.6 • 3.2K Ratings
🗓️ 8 May 2019
⏱️ 32 minutes
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Summary
What is the best way to pay down debt? Americans are in tremendous amounts of debt (think over 400 billion on just credit cards alone)! Not only is this debt keeping folks from reaching their financial goals, but it’s also taking a toll on the mental health of borrowers. Knowing the best strategy to get out of this debt is a big deal and could be the difference between living paycheck to paycheck or achieving financial freedom. Listen as we cover both approaches so you can decide which is better for you: the debt snowball (popularized by Dave Ramsey) and the debt avalanche (also known as debt stacking).
During this episode we enjoyed a Maple Vanilla Copra Kai by Southern Grist Brewing which you can find on Untappd. Another big thanks to Jamie and friends up there in Nashville for donating these beers to the show! And if you enjoyed this episode, be sure to subscribe and give us a quick review in Apple Podcasts, Castbox, or wherever you get your podcasts- we’d love to hear from you.
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Transcript
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| 0:00.0 | Welcome to How To Money. I'm Joel and I am Matt. |
| 0:03.6 | And today we're discussing the Dead Snowball vs. Dead Avalanche approach to paying down your debt. |
| 0:09.4 | The Edge-O we are talking about the hotly debated topic of how you should pay down your debt. |
| 1:03.8 | I disagree with him on 99% of things except for this one thing that he does. |
| 1:08.4 | Okay. Yeah, but no, I feel like he has helped so many people. |
| 1:11.8 | Yes. |
| 1:12.2 | And in particular to get out of debt quickly, that I would think twice before speaking harsh words |
| 1:17.0 | against him just because of how much of a good effect he has had in a lot of people's lives. |
| 1:22.3 | I think tackling this topic of how you pay down your debt quickly and which of these methods is |
| 1:27.4 | most effective is going to be good. It's going to be good for us to talk about. |
| 1:30.4 | Yeah Dave Ranze, he's like the Godfather for personal finance for me, man. |
| 1:33.6 | He basically ushered me into this entire space, like 10 years ago. |
| 1:37.6 | So I owe him maybe at least a little tip of the cap to kind of launching my financial journey |
| 1:41.6 | to a certain extent. |
| 1:42.5 | And sometimes there's a teacher that's really great for a while and then you kind of move past |
| 1:47.6 | what they have to offer. But yeah, I'm really interested to tackle this topic today. |
| 1:51.2 | Yeah, it should be fun. Matt, before we get to that, I wanted to add Frugal vs. Cheap. |
| 1:54.8 | Yeah, I kind of wanted to ask you a question. |
| 1:56.0 | I see that written down here. So is it Frugal or Cheap for me to forego buying my kid school pictures? |
| 2:04.6 | Well, most folks know that I'm a photographer, right? |
| 2:06.8 | So I'm curious what most folks think. |
| 2:08.7 | Do they think I'm going to fall on the side of, no, don't argue being way too cheap. |
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