Benefits
The primary benefit of the smallest-balance plan is the psychological benefit of seeing results sooner. Retirement contributions should start once your expected investment yield is higher than the next highest debt interest rate (generally 8% for a balanced portfolio).
A secondary benefit of the smallest-balance plan is the reduction of total amount owed to lenders in a single month. This is a risk reduction in the event of a lost job or emergency.
Read more about this topic: Debt-snowball Method
Famous quotes containing the word benefits:
“It is too late in the century for women who have received the benefits of co-education in schools and colleges, and who bear their full share in the world’s work, not to care who make the laws, who expound and who administer them.”
—J. Ellen Foster (1840–1910)
“Through all opposition the personal benefits of the reform [dress] [bracketed word in original] have compensated; but had it been mainly sacrifice, the thought of working for the amelioration of women and the elevation of humanity would still have been the beacon-star guiding me on amid all discouragements.”
—Susan Pecker Fowler (1823–1911)
“It is with benefits as with injuries in this respect, that we do not so much weigh the accidental good or evil they do us, as that which they were designed to do us.—That is, we consider no part of them so much as their intention.”
—Laurence Sterne (1713–1768)