Take a few minutes to decide which debt gets paid off first. Determine how much extra you can spare to apply to your bills on a monthly basis. Earmark larger payments to the higher interest accounts first.
If you have several smaller accounts, with high interest rates, these are a great place to start. You will get twice the benefit here because you are eliminating high interest rate balances plus you will see dramatic and almost immediate results.
Stay with one bill until it is paid off, don’t try to “spread” the extra money to extra payments on several bills at the same time.
Budgeting Payments With Rollover Payments
Once a targeted account is paid off, rollover the budgeted money to the next account on your list. Using a rollover, or accelerator, to payoff your bills gives you continuous emotional reinforcement, helping you to stay focused and living within your budget.
Use the following Budgeting Steps summary as your guide to get your personal finances back in control. Don’t forget: Download the free ebook about household budgeting and money management.
- create a personal budget
- track all your spending
- adjust your budget
- cut out the waste
- build your emergency fund
- decide which accounts to payoff first
- rollover payments
The most important single factor in becoming successful with your budget and getting your finances under control, is knowing where your money is going. You need to track your expenses, so you can control them!