If one of your New Year’s resolutions is to improve your finances, experts at Virginia Tech have some tips for you.
A good place to start is evaluating how much of your income you are using to pay off debt. A good next step to stay motivated is to use the ‘snowball method’ to pay off those debts.
“So whatever your debts are, you’re going to line them up smallest to largest, and then you’re going to start paying off those smallest debts first and working your way up,” said Erin Cox, Family and community economic specialist with the Virginia Cooperative Extension. “And there’s something just exciting and it has a psychological effect that motivates you, once you start paying off those smaller debts to keep going.”
“So whatever your debts are, you’re going to line them up smallest to largest, and then you’re going to start paying off those smallest debts first and working your way up, and there’s something just exciting and it has a psychological effect that motivates you, once you start paying off those smaller debts to keep going.”
Erin Cox, Family and community economic specialist with the Virginia Cooperative Extension
It is also important to think twice before using ‘buy now pay later’ services, as they make it easier to go over your budget.