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Does the Dave Ramsey debt snowball technique actually work?

dave ramsey

Most of you have heard of personal finance guru Dave Ramsey, and most of you have heard of his debt snowball tactic. From his website:

Myth: I should pay off the debt with the highest interest rate first to get out of debt quickly.
Truth: You should pay off the smallest debt first to create the greatest momentum in your debt snowball.

The math seems to lean more toward paying the highest interest debts first, but what I have learned is that personal finance is 20% head knowledge and 80% behavior.You need some quick wins in order to stay pumped enough to get out of debt completely. When you start knocking off the easier debts, you will start to see results and you will start to win in debt reduction.

But the question needs to be asked: how well-founded is Ramsey’s assertion that paying off the smallest debt first is the best way? You can get anecdotes and metaphors to support any point of view, but is there anything more rigorous underlying Ramsey’s marketing pitch? [click to continue…]

Free money, $20/$50 at Lowe’s, intrigue at Amex and Suntrust

money for nothing

FREE STUFF AT STAPLES: What’s free at Staples this week? Money, for one:

So you know the drill: buy a couple of $200 Visa prepaids and you’ll come out a couple dollars ahead AND you’ll have the points. Also free this week at Staples: Crayola washable markers, Bic mechanical pecils, and–of course–paper, because this is Staples, and Staples wants everybody to get free paper. Deal details can be found in the Slickdeals thread. And Big Habitat has another idea for how to profit from Staples this week. [click to continue…]