What is Snowballing?

Pan_3

Many apologies if this is answered elsewhere but I have had a look but cannot really find anything.

I notice alot of people refer to a concept called snowballing in order to escape the never ending spiral of credit card minimum payments. Can someone please explain what this is and how it works as the £95 min payment I make to my Visa card every month is not touching the OS balance.

Phoenix79_2

Snowballing is prioritising your debts so that you pay off the debts with the highest interest first.

https://www.whatsthecost.com/snowball.aspx

Load all your debt info into that and see what it says

CLAPTON

snowballing is a term applied to paying off multiple debts. basically you pay the minimum amoiunt on each debt except the one with the highest APR. On that one you pay as much as possbile until its all paid off. then you start on the one with the next highest APR and so on. this ensures you pay the minimum interest and pay off the debts in the shortest time.

it doesn't apply to a single debt.
for any single CC, if you pay only the minimum it will typically take years and years to pay off the debt. its absolutely essential to always pay more than the minimum ...if fact as much as you can.

HairyHandofDartmoor

Yes, you can only snowball if you have more than one debt.

ShakerSonicBen

not heard of snowballing in this sense before, looks quite usefull I will check it out.

to tell you the truth i was a bit worried when i oppened the thread.

Phoenix79_2

ShakerSonicBen wrote:

not heard of snowballing in this sense before, looks quite usefull I will check it out.

to tell you the truth i was a bit worried when i oppened the thread.

Lol......get your mind out of the gutter!

ShakerSonicBen

Phoenix79 wrote:

Lol......get your mind out of the gutter!

hehe whoops