Criticism
People with more financial discipline can get ahead quicker by paying off the credit cards and loans with the higher interest rates first. This will minimize costs to become debt-free faster than the smallest-balance approach. Dave Ramsey, a proponent of the debt-snowball method, concedes that "the math" leans toward paying the highest interest debt first; however, based on his experience, Ramsey states that personal finance is "20 percent head knowledge and 80 percent behavior" and that people trying to reduce debt need "quick wins" in order to remain motivated toward debt reduction.
The Debt-Snowball method is only for those on high enough incomes to be able to meet all the minimum repayment requirements on their debts. This method could instead lead to problems for those who are struggling to meet these minimum payments demands. In this circumstance, an individual should not be advised to pay creditors differing amounts as this could count as non-equitable repayment, leading to problems (e.g. with going bankrupt, or with maintaining non-equitable repayments over longer periods).
Read more about this topic: Debt-snowball Method
Famous quotes containing the word criticism:
“Nothing would improve newspaper criticism so much as the knowledge that it was to be read by men too hardy to acquiesce in the authoritative statement of the reviewer.”
—Richard Holt Hutton (1826–1897)
“The aim of all commentary on art now should be to make works of art—and, by analogy, our own experience—more, rather than less, real to us. The function of criticism should be to show how it is what it is, even that it is what it is, rather than to show what it means.”
—Susan Sontag (b. 1933)
“As far as criticism is concerned, we don’t resent that unless it is absolutely biased, as it is in most cases.”
—John Vorster (1915–1983)