Avalanche or snowball: which is your debt plan?
Adopt a strategy that suits your needs, but make lifestyle changes to be debt-free
Avalanche strategy means focusing more on debt with the highest interest rate, and paying the minimum to settle other debts
When working as a debt counsellor with Abhay Credit Counselling Centre, an initiative by the Bank of India, V.N. Kulkarni advised borrowers who were drowning in debt. There was one thing common among the majority of the cases. The borrowers spent heavily on credit cards and then kept paying the minimum amount due, which is, typically, 5% of the outstanding.