There are numerous ways to reduce your total and monthly debt load, many less painful than others. The obvious one, of method, is to simply pay down your bills. That can be difficult, and for a majority of people it may seem hopeless, but there is one scheme that has been employed by many with much success and that is the snowball approach (so named by Dave Ramsey).

Remember, try to remain focused and you can become debt free using the snowball method, sometimes without professional debt help.

This method, in essence is very simple, audit your bills from lowest to highest. Pay the bare minimum required on all monthly bills, then allocate any left over funds you can, to paying off the lowest debt first. Thus, the lowest debt will get paid off initially, this frees up yet more money to allocate to the next lowest, which is now the smallest debt, repeat these steps until you have achieved the level of debt you want or can manage.

This course has several advantages, you see regular, visible progress in reducing your bills and in a relatively short period of time you could well be down to a liveable level. As you roll-off those accounts, you have more free income which can possibly be split between payments on the debt next in line and the enjoyment of maybe some rewards.

Psychologically, this assists keeping the debtor motivated to continue the program, seeing real progress helps one stick with it during a financially challenging period, but, for all its virtues, the procedure does have one real drawback. It indeed requires a longer period of time and more money overall to pay off all your accounts that way, the reason has to do with how interest is compounded.

If you pay off a $1,500 debt or loan, a $3,000 loan or debt and a $15,000 debt or loan they may all have the same rate of interest, however paying off the lowest amount initially will indeed cost you more in total interest paid, since any outstanding amount will be charged at the same rate of interest, the higher amount will incur the largest charge, as a result, over time, you will pay more in total interest charges.

Reversing the order and paying the highest amount first, without doubt saves you money in the long run, as you pay down the largest debt first, you are reducing the amount of interest and money paid over time. The difficulty is that the latter scheme, though more cost effective in the long run, is harder for most people to remain focused and committed too. It takes a lot of discipline to live with that debt burden as you slowly bring down the $15,000 debt or loan.

With the majority of interest rates, the lower debts will clearly get paid off initially, but in the meantime you are making high monthly payments that takes great willpower every month. That willpower is the one thing that many people deep in debt find hardest to generate. it's the one factor, often, that led to the sky-high debt in the first place, for these people, using the snowball approach may well be an advantage, despite the larger total amount paid out over the life of all the bills combined.