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:
“In America the young are always ready to give to those who are older than themselves the full benefits of their inexperience.”
—Oscar Wilde (1854–1900)
“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)
“One of the benefits of a college education is, to show the boy its little avail.”
—Ralph Waldo Emerson (1803–1882)