How to Ladder Debt

Everyone wants to get out of debt and find the quickest way to do so. A popular idea is Dave Ramsey's "snowball method," which instructs you to first pay off the debts with the highest interest rate. A similar method is the "ladder method," which requires you to pay off your loans from smallest to largest. It's easy to ladder your debt to make a plan for paying it off, but the key to success is to remain committed to paying it.

Instructions

1

Gather all of the financial statements from your creditors. Look at the most recent statements.

2

Make a list of the debts, starting with the lowest debt and going up to the highest. This is your "debt ladder."

3

Pay the minimum amount due on all debts, except for the smallest one. You need to make these minimum payments to keep your good credit score or to improve your credit score.

4

Free up extra money to pay towards the smallest debt. Look at your budget to find areas where you could reduce expenses. Apply all of the extra money towards the smallest debt.

5

Continue paying your way through the debts on your debt ladder. After you finish paying off the smallest debt, take all of the money that you were paying towards that debt and apply it to the second one. Repeat this process until you have paid all of your debt.