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:
“Unfortunately, we cannot rely solely on employers seeing that it is in their self-interest to change the workplace. Since the benefits of family-friendly policies are long-term, they may not be immediately visible or quantifiable; companies tend to look for success in the bottom line. On a deeper level, we are asking those in power to change the rules by which they themselves succeeded and with which they identify.”
—Anne C. Weisberg (20th century)
“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)