Why the Debt-Snowball Method Works

The reason why you’re stuck with credit card debt could be due to several reasons: emergency expenses, poor financial management, or just chronic debt denial. Whatever it is, no doubt that credit card debt incurs higher interest rates compared to most other types of loans and in the long run make carrying balances expensive for cardholders.

Maintaining a credit card can be beneficial to your credit score only if you are paying on time and making sure you don’t carry balances. It’s best to pay your credit card balances in full every month but I think you already know that. You’re reading this article because you need solutions to your credit card dilemma.

There was a time that I was carrying balances in all my five credit cards. That’s why I understand how debt can be stressful and cause an anxiety attack. It felt like all the money I was paying just went to interest fees and my balances weren’t budging. As much as I try, I didn’t see any progress in paying off my accounts. Not that I wasn’t trying. I would always pay the minimum amount, sometimes more if I had extra money, and I never skipped any due dates. Still, I felt like drowning with credit card debts.

There is one strategy that helped me paid off all my credit card balances once and for all. It’s called the debt snowball method.

The idea for the debt-snowball method is simple. List down all your debts and arrange them from smallest to largest regardless of the interest rate. Next, make minimum payments on all your credit cards except the one with the smallest balance, which should be your topmost priority. The smallest balance debt should be attacked with vengeance! Had a windfall? Pay off this card first. Got a bonus? Allocate a big portion to pay your small card balance. Can you save money from using coupons? That saved amount should be put into card payment as well. Give your all!

Once you managed to kick the first debt on your list to the curb, it’s now time to tackle your second debt. Again, make minimum payments to all your cards except the second one on your list (which is technically the smallest balance now since you’ve managed to zero balance the earlier one, Yipee!) Not only you’re paying the minimum amount as usual to your second card, but you’re also rolling over the freed-up money from your first debt to pay the second debt on your list – like a snowball!

As you say goodbye to your second debt, continue to send all the money to the next debt on your list while making the minimum payment to the rest. Before you know it, you’re now debt-free. Amazing, isn’t it?

Why the debt-snowball method works?

It’s all about mindset. By seeing positive results, you’re likely to stick to it. Once you get rewarded for an action (in this case, paying off your smallest balance card), you want to do more of it. It doesn’t matter if it’s only your smallest debt, the motivation and momentum are what makes this debt-reduction strategy works.

Once all your credit card debts are eliminated, take all necessary steps to avoid being trapped again to the situation. Avoid overspending, live below your means, create an emergency fund, and don’t forget how stressful your life was when you still had debts. Hopefully, that would remind you to manage your finances better. …

My 3 Favorite Travel Credit Cards

Travel credit cards help you enjoy your travel more with flight upgrades, free hotel stays, and travel and overseas purchase protection. You can even score free flights using the points you earn for traveling frequently.

Travel credit cards can be beneficial, only if the perks outweigh the annual membership fee. Many credit card users will balk on paying a yearly fee but for frequent travelers, the travel privileges and benefits are worth it.

When choosing your travel card, think about what’s more important to you and if each card offered benefits can be really utilized considering your travel frequency. To help you decide, here are my top three favorite travel credit cards with their big signup bonuses, travel benefits, and competitive rewards. 

Chase Sapphire Preferred Card

It’s no surprise that Chase Sapphire Preferred Card has been widely recognized as the best travel credit card by many travelers. It has an excellent sign-up bonus offer of 60,000 points after spending $4,000 in the first three months of account opening. This automatically translates to $750 in value that can be redeemed through their reward points system. This particular card also has a solid rewards rate: 5X points on Lyft rides, 2X points on dining and travel, and 1 point per $1 spent on all other purchases. All this for a low annual fee of only $95.

The best-known travel perk of Chase Sapphire Preferred Card is the auto rental collision damage waiver that covers the cardmember, and permitted driver by the rental car agreement, for vehicle damage due to accident or theft. This insurance kicks in before your auto insurance and is quite generous.

Capital One VentureOne Rewards Credit Card

Its straight forward rewards earning scheme makes VentureOne perfect for travel beginners and budget-conscious travelers. VentureOne waives the fee for the first year and charges a $95 annual fee after that. The card also offers a sign-up bonus of 20,000 miles after spending just $1,000 in the first three months. You also earn unlimited 1.25 miles per dollar on every purchase, and no transaction fee when purchasing outside the United States, unlike the eBay Mastercard.

While this is a benefit that, hopefully, you’ll never use, the VentureOne offers travel accident insurance getting up to $250,000 worth of coverage when you use your credit card to purchase the fare. 

The Platinum Card from American Express 

Its annual fee of $550 might be considered high when compared to other travel credit cards, but with The Platinum Card‘s amazing annual credits, you can easily recoup the cost. Offering 5X on airfare and prepaid hotels booked directly with American Express Travel, $200 statement credits annually for checked baggage and in-flight refreshments, a total average value of $550 for hotel stay benefits, and up to $200 in annual Uber credits – the perks are truly unapparelled. 

The best thing about The Platinum Card is the 1,200 airport lounges access across 130 countries. You can relax and enjoy complimentary food and beverages on The Centurion Lounges, Delta Sky Club Lounges, and Priority Pass Select lounges.…

What is the Amex Black Card?

Officially called American Express Centurion Black Card, Amex Black Card is one of the most exclusive charge cards ever. Why exclusive? Because you can’t apply for it. The only opportunity to have one is if you get invited and you accept the invitation.

Now you might ask, if the Black card is so prestigious, why would someone decline to have one? Well, if you don’t mind paying for the initiation fee of $7,500 and the annual fee of $2,500, sure go ahead, take it. And make sure to spend, rumor has it, around $350,000-$500,000 annually in a calendar year across all your Amex cards to get invited, and maintain enjoying this titanium card (yup! not a plastic one that you and I have).

Is it worth the annual fee?

With its $10,000 annual fee with no sign-up bonus, is it worth having one? The actual benefits of the Amex Black Card are shrouded with mystery which adds to the mystique of the card, but no fret, we made some digging and found some actual benefits of the card as reported by existing users.

If you’re a frequent traveler and want to be rewarded for your flights and other travel expenses, Amex Platinum seems to be a better choice giving 5x points on airfares purchased directly with the airline and prepaid hotel stay booked through American Express Travel. The Black card doesn’t offer this although you’ll earn 1x Membership Rewards point per dollar spent, which is equivalent to 2 cents more or less.

The Amex Black Card is enticing for users who’s after lifestyle and luxury-experience perks. A Black cardholder will automatically become a Marriott Bonvoy Gold status member, Hilton Honors Diamond member, IHG Platinum Elite status member, and enjoy many hotel programs that give complimentary room upgrades, late check-out, transfers, and other special amenities offered to the Platinum and Centurion cardholders. Users can also enjoy airport lounge access, complimentary flight upgrades, complimentary Priority Pass, and many other exclusives offer for dining, events, and shopping.

Most of all, based on the account of Amex Centurion Black Cardholders, the greatest perk is having a personal Centurion concierge who can do things for the cardholder (as long as it’s legal, of course). From buying flowers, to getting you a concert ticket, and to evacuating you from a country – it’s like having a super reliable personal assistant who, at the same time, can get you to these VIP, exclusive parties and events.

The Centurion card is one of the most coveted travel cards one can have and it offers more premium rewards than many other credit cards. Many of us will never get to decide if we want one or not which adds to the card’s elusive and mysterious appeal. If you get invited though, the Black card should be considered for bragging rights of being a member of the “Black card club”.

As an alternative, the Platinum Card from American Express is also a great choice that offers the same benefit as the Black card except for the Delta Platinum Medallion Status, plus the annual fee is just $550.…