Welcome to SolidPlanning.com. Solid Planning is a site where our dreams, strategies, and hard work are combined to produce tangible results. On this site we will review books, tips, tricks, and strategies, looking for ways to build our plan to meet the 2009 goals posted in the far right column. As we make progress we'll bring you along with articles and stories on this site. We welcome your suggestions and feedback along our journey so please feel free to leave comments!

Jan 11, 2009

Prioritize Your Credit Card Debt to Maximize Payments

If you have several credit cards with balances, prioritizing your debts can make better use of your payments. This technique improves the allocation of your monthly payments through a process we call "Debt Streaming". Debt Streaming maximizes your payments to ensure you receive the best results possible based on your existing payment structure.

The technique works like this:

  • Track down all of your credit card statements.
  • List your credit cards including the interest rate, balance, and the amount you are paying monthly.
  • Sort the list based on the highest interest rate to the lowest interest rate.
  • Add up all of the payments you have been making to determine the amount you are currently Debt Streaming. (This is assuming your payments are more than the minimum payment.)
  • Make the minimum payments on all of the account except for the account with the highest interest rate.
  • Pay as much as you can on the account with the highest interest rate.
  • Once the account with the highest interest rate is paid off apply the payment amount you were making to the account with the next highest interest rate.
  • Continue to follow the steps listed above and you will begin to rapidly shrink your debt balances.

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