For many people, getting out of debt may seem impossible. But if you focus on paying more than what’s owed on your minimum monthly balance, it might be easier than you realize, according to Get Rich Slowly founder J.D. Roth.
“The whole idea is you’re just trying to throw as much money as possible at these debts so you get them paid off quickly,” Roth tells NBC News BETTER.
Roth calls this the “debt snowball,” a method made popular by businessman and author Dave Ramsey.
First, build a “debt snowball”
Let’s say you have five debts that total $1,000 a month. Eventually, you pay off one of those debts, and bring down your monthly payment to $800. Instead of paying the minimum, you continue paying $1,000 until your debts are all fully paid.
That includes using any raises, bonuses or windfalls to pay off those debts, Roth says.
“You just continue to throw that money at your debt repayment and by doing so — as you’re making more than minimum payments — the debt gets repaid much more quickly,” Roth says.
The blogger said he used the method to get out of $35,000 of consumer debt when he was in his mid-30s.
“It took 39 months [just over 3 years] to pay off the $35,000 once I started focusing on it,” Roth says.