Highlights of today's show:
- The Debt Snowball IS the best way to pay off your debt
- Spending less is important but it has its limits
- Making more money will only help you if you know how to manage it
- Both are important to managing your money better
- Webinar coming up on August 30th at 9PM EST. Details can be found on the blog.
There is a lot of debate among financial experts over which method is the best way to pay off your debt. Some prefer to pay off the debts with the biggest payments first, others prefer to pay off the debt with the highest interest rate first, which makes the most sense mathematically. But I recommend the Debt Snowball method to pay off your debt. Well, a couple of researchers from Northwestern University have discovered that the snowball method is the best way to pay off your debt! We start today's show by discussing why that is true.
In addition, I try to tackle the topic of what's more important when it comes to personal finance: spending less or making more money. It's an important topic to discuss because so often in the personal finance world you are on one side of the fence or the other and there are not a lot of people in the middle. Personally, I think they are both important and that you need to do both well to win with money.
Being able to cut back and avoid the lifestyle inflation trap that most people get stuck in is great. But the problem with cutting back is that you can only cut back so much. We all have a minimum number that we have to live on. But by being able to cut back and live on less, you are developing good habits that you can take with you when you start to make more money.
Likewise, making more money is great, but just because you make a lot of money doesn't mean you will have financial success. If you have no idea how to handle that income you will lose control of your spending and you will have no idea where it went.
What about you? Do you think it is more important to make more money or spend less when it comes to getting out of debt? Let us know on our Facebook page.
Finally, I am doing a webinar on Thursday August 30th, titled "You Are Debt Free . . . Now What?" I would love for all of the listeners to join us if you'd like. If you can't make it to the live presentation, please sign up anyway to receive information on catching the replay.
You can subscribe to future Podcasts through Feedburner, Stitcher SmartRadio, or iTunes. Or you may listen to the podcast on the JW's Financial Coaching Facebook Fan page. In addition, if you have enjoyed the show for a while now, please leave a review of the podcast on iTunes. For a step by step video of how that works, please watch this video on how to leave a review in iTunes. Big thanks to my friend Glen Steinson for helping me create the video.
If you have any comments, questions, or ideas for future shows you can send them to me and I will integrate them into a future show. There are two ways to get in touch with me:
1.) Email me at JWFinancialcoaching@gmail.com - Please put “podcast” in the subject line and keep your questions brief so they are readable on air.
2.) Simply fill out the form on the contact page. Please fill out your name, email, and your question/comment/suggestion and we will read it on air.
You can find prior editions of the podcast at the podcast archive page.