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How to Clean Your Room (or Pay Off Debt)
How to Clean Your Room (or Pay Off Debt)
Cleaning your room can be a monumental undertaking. All the different toys and all the pieces of toys can make the proposition of cleaning your room seem overwhelming. "A problem so big and unfix-able why even start?" - Right? The other thing about a messy room is how quickly it can become messy. Oftentimes the room was clean just a couple of days ago and now look, its a mess again.
Here's how to clean your room.
Organize all of the different toys into categories based on the number of pieces. For instance, stuffed animals, dolls, accessories, building blocks, cars, action figures, books, clothes, unmade bed. Pretty overwhelming list. And, some of these items consist of many parts and pieces.
Arrange the toys according to the number of pieces the toy has. There is only one bed so its first on the list. The building blocks/doll accessories contain many small pieces so they are last on the list.
Attack the list by first maintaining the amount of mess from the other items (don't get distracted and begin playing with the other toys). You will feel a sense of accomplishment with each "easy" victory. This will motivate you towards completing the ever-increasingly larger chores. But soon, you will have a clean room again.
Debt is a lot like a messy room. Lots of different types of debt and lots of different amounts and its amazing how fast the debt can grow. Soon the amount seems so large and unfix-able "why even start?" - Right?
Paying off debt is much the same as cleaning your room... enter, the Debt Snowball.
The Debt Snowball is a method of debt management where you organize all of your debts smallest to largest, by amount. While paying the minimum amounts on all debts, you put all of your excess funds into the smallest debt first.
Once the smallest amount of debt is paid off you take the money that was going to it and roll it into the next largest debt. You continue this process of rolling ever-increasing amounts of money into the next largest debt until all the debts are paid off.
There are more effective methods to paying off debt, but I believe more personal satisfaction comes at a quicker pace through the snowball method than any other option.
Lastly, while the Debt Snowball is usually used for credit card debt, the principles can be applied to all debts. For instance, your credit cards may have the smallest debts so they would be paid off first, but then, continuing the process for your car loans, student loans, and even your home mortgage. Paying the smallest amount of debt to the largest. Within a few years you can be totally debt free!!
Here is a link that you can use to calculate your own debt snowball.
https://financialmentor.com/calculator/debt-snowball-calculator
PRO TIP: Once you have these debts paid off, keep paying the total amount of debt but now into a savings account and start working towards living a 60/20/10/10 lifestyle.
Questions:
How successful would you be if you had to start cleaning your room by picking up all of your toys? How do you feel about cleaning your room by starting with picking up just the stuffed animals (or some other type of toy) first?
Do you think there could be a correlation between students with messy rooms and adults with debt issues? Defend your position!!
Using the numbers from the table above, add a car loan for $10,000, with a minimum payment of $300 dollars. After paying the minimum for 16 months (the time it took for the original snowball), how long would it take you to have the car paid off when you can double the car payment by using the snowballed money?
NOTE: This table is for illustration purposes only. You are not factoring in the amount of interest saved by paying off the loans early. While the dollar amount saved will not be significant (because the size of the loans are small) you would actually pay these debts off just a little bit faster than is shown here!
Resources:
Google Sites
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