Accelerated Debt Relief Made Easy + Secrets to Success

Dec 21 20:17 2009 Jesse Niesen Print This Article


Instead of paying off your debt with a lump sum check,Guest Posting here's another option which is the next best thing. If you want to get out of debt as fast as you possibly can without having any negative impact on your credit whatsoever, you must pay down and pay off your debt using an accelerated debt relief strategy.

There are three variations of accelerated debt relief, each with their own names: "margin roll up plans", "roll down plans", "the debt snowball", "the DOLP method", and many other names you may have heard used for the same strategy. These accelerated debt relief strategies are promoted by David Bach, Dave Ramsey and pretty much every financial guru out there, usually calling it their own unique name as if it's some "secret method." They are all "accelerated debt pay off plans." All three methods of accelerated debt relief boil down to the same principles.

The Basics of Accelerated Debt Relief

An accelerated debt pay off plan will get you out of debt as fast as possible without having any additional negative impact on your credit whatsoever. If your credit score or preserving a perfect payment history is more important to you than freeing up cash flow or the savings other options offer, then accelerated debt relief is the only way to go. You will have zero negative effect on your credit with an "accelerated pay off plan." Your credit will only improve by maintaining a good payment history, reducing your debt-to-income ratio and lowering your debt-to-credit-limit ratios.

Accelerated debt pay off plans comes in three main types. In each method, you continue to pay the minimums on all account. All the additional money you can possibly afford beyond this becomes the money you're going to use to accelerate paying off your debt. This is often called your "margin." Your margin is then focused on ONE account at a time until it is paid off. Then your margin is focused on the next account on the list. The three different methods determine order you pay off each of your accounts.

Here are all three types of accelerated debt relief, clearly explained:

Lowest Balance First:

List your debts in order of the highest interest rate to lowest. Use your margin funds to pay down the highest interest account first (it's costing you the most) until it's paid off, then pay down the next highest interest rate account and so forth, until your debts are eliminated...

Get the benefit of the snowball effect, but you may pay more interest in the end than Highest Interest First. The main benefit of this approach is the psychological effects of seeing the number of debts disappear more quickly.

Highest Interest First:

List your debts in order of the current balance, paying down the account with the lowest balance until it's paid off, (this can help your credit by showing open accounts with low to zero balances, improving your debt to credit limit ratio), then pay down the next lowest balance account, etc., until your debts are eliminated...

This strategy results in the lowest total interest, but depending on the balance of your higher interest loans, it may take you longer to see your first loan/debt completely paid off. If the difference in the total interest is not significant, then you may get more satisfaction from the Lowest Balance First method.

Lowest Division First:

Take the current balance of each account and divide it by the minimum payment. This is your "division" number. Then list your debts by this "division number" from the smallest to the biggest, paying down the account with the lowest division number first until it's paid off. Then pay down the account with the next smallest division number, and so on... Continue until you're debt free...

This strategy results in the fastest pay off, but depending on the balance of your lower division debts, it may take you longer to see your first debt completely paid off. If the difference in the total time is not significant, then you may get more satisfaction from the Lowest Balance First method.

Secrets to Success with Accelerated Debt Payoff Plans

Each of these "accelerated pay off" approaches requires paying significantly MORE than your minimum payments. Any of these three Accelerated Debt Pay-Off Plan approaches can usually get you out of debt in about three to seven years if you can afford to pay a total of double or triple your minimum monthly payments towards paying off your debt. This can take less or more time depending on your total debt and how much you are able to put towards paying it off. If you really get serious about it, you could be debt free faster by putting more money towards paying off debt.

You must cut your expenses to the bare minimum and put EVERY DOLLAR you can towards paying off your debt in an accelerated fashion in order to get out of debt ASAP. It requires ultimate self discipline and long term commitment.

Accelerated debt relief a very simple idea but few consumers organize their accounts or payments in any fashion. People may put their extra money towards the largest balances, or take turns putting extra money throughout all of their accounts, continually paying interest on their entire debt profile. Instead, an accelerated debt pay off plan is a more effective way to structure your payments and put your money to its best use.

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About Article Author

Jesse Niesen
Jesse Niesen

Hello! I'm Jesse Niesen of DebtGoToGuy.com, author of "Debt Free ASAP!"

I'd like to give you Free Instant Access to my "Debt Relief Guide" where you get Info (debt analysis, audios & videos), Tips & GUARANTEED Answers to Your Questions, so you can make "your best choice" to be Debt Free ASAP. I've made it easy for you to finally get this area of your life handled.

Plus, for a limited time I'm offering the 29-page, full-color "Debt Relief Analysis" & Guidebook I sell online at DebtReliefAnalysis.com for $27.00 as a free gift for all new subscribers to the Debt Relief Guide Online.

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Jesse Niesen
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