There is a horrific plague that seems to be sweeping across America destroying homes, families and leaving people feeling hopeless. The name of this plague is debt.

The average American family carries around $8000 of credit card debt, not to mention car and home loans. To put this in perspective, if a household with $8000 of debt on a 15% APR credit card, pays $100 a month-not accruing anymore debt-it will take 29 years and six months to pay the card off and they will have paid $27,374 in interest.

Simple personal finance and money management can put a stop to debt and wealth can be acquired in its place.

Managing Personal Finances

Every cent that a person doesn't spend purposely will eventually find some place to go and more often than not, it will not be somewhere that helps them stay out of debt.

The key to managing personal finances is assigning each and every dollar a purpose, like credit card payments, car payments or even towards a budget or a savings account. You may want a certain amount of money that you assign to nothing. This money you can spend however you want and you don't have to feel guilty about it.

After spending money on payments, putting what you want in savings and your budget (i.e. groceries, gas, entertainment, etc.), any left-over money should be purposely spent as well, and a good place to spend it is towards debt.

Applying Debt Rollover to Your Personal Finances

Debt rollover is a simple and efficient way to pay off your debts. Consider the following situation that shows how the debt rollover plan works:

Imagine you have two credit cards, a student loan and a car loan. The first step in the debt rollover plan is to list your debts from the debt with the lowest balance to the debt with the highest balance. Let's say the order goes as follows: credit card A, credit card B, student loan and car loan-this is also the order you should pay off your debts. It is important to start with the debt with the lowest balance so the debt rollover can start as soon as possible.

Make the minimum monthly payments on all of your debts but on credit card A try and increase your payment in order to pay the card off quickly. This will get the debt rollover started and, one at a time, you can apply more money to your other debts.

Once credit card A is paid off, take the amount of money that was assigned to pay off credit card A and add it to the minimum payment of credit card B. As soon as credit card B is paid for, take the amount of money that you were paying on credit cards A and B and add it to the minimum payment of the student loan. This loan should deplete quickly and once it is paid off, the rollover will repeat until the car loan is paid in full.

Through spending your money wisely, the debt rollover plan and personal financing you can save thousands of dollars in interest and avoid the debt plague.

At TopTenREVIEWS We Do the Research So You Don't Have To. 


Clason, George S., The Richest Man in Babylon. New American Library. (1955)

The Truth About Credit Card Debt. Dave, (2004)

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