In this lesson, you’ll learn how to use the debt avalanche method to save money on interest fees while digging out of debt.

Description

A debt avalanche is a plan to pay off your highest interest debt first while continuing to make minimum payments on all of your other debts. It may take some time, but when your highest interest card is paid off, you’ll be able to use the extra money you now have to pay off your second highest interest card more quickly. Payoffs will come faster and faster as you pay off more loans or cards and have more money to direct toward paying off the loans or cards you have left. Read this Investopedia article to learn exactly how and why it works. To understand how to follow the debt avalanche plan for yourself, complete the following assignment.