Debt Consolidation

The Facts About Debt

How Debt Stacking Can Help You Eliminate Debt

Filed under: Debt Consolidation
Written by: UWSA Staff
November 5, 2008

Many people today are worried about excessive debt, especially with news of higher unemployment ( and fewer raises. A lot of folks are trying to accelerate their debt, but feel it is futile, as additional payments don’t significantly reduce their debt. There’s a right way to accelerate your debt that many are unfamiliar with; it’s called debt stacking. It accelerates your debt payments with no additional charges, and without necessarily even paying more than the minimum monthly payment.

Most people who try to accelerate the process of paying of their debt use the “shotgun” approach. For instance, one month they will pay 100 dollars on one account, then a different account the following month. The problem with this is twofold. Firstly, it doesn’t actively target the accounts with the highest rates and fees that are keeping you in debt longer by taking more of your income for the interest and fees that could be more effectively applied to principal. Furthermore, it doesn’t consider that accelerating large debts make keep you paying added fees on small ones for a long period of time, which could be avoided by simply picking off the small debts quickly. It all comes down to getting out of debt faster and paying as little as possible in interest.

The first step to debt stacking is to make a list of all your debts, the minimum monthly payments, and the interest rates. It’s important to note which debts are fixed debts, for instance a 5-year car loan, and which are revolving, like credit cards, or in store credit accounts. Whether you work out the debt stacking yourself or use a debt-stacking program, you still need this information.

If you really want to kiss your debt goodbye, then it makes sense to set aside at least a little extra every month to help accelerate your debt. If that isn’t possible or doesn’t interest you, then you can just keep paying the minimum monthly payment. The key is that once you’ve made your list, you put it into order according to which debts to pay first and which ones to pay last. Once you’ve paid one off, you take the money you had been applying to the monthly payment of the first debt and apply it to the next one on the list along with the minimum payment for that debt.

The question now is how to put your debts in order. There are a few ways to do this, and it’s somewhat subjective. Some people simply sort the list so that the highest interest debts are first and lowest interest debts are last. Others use debt calculators to determine how long each debt will take to pay off, and put the shortest ones at the top so that they know the fastest way to get out of debt. Also, there are computer programs that can look at this in more detail by making projections based on all the combinations of payments the fastest possible way.


Debt stacking isn’t the same as debt consolidation, and it’s often not as fast or as dramatic in terms of freeing up money. That said, debt stacking could be used in conjunction with debt consolidation. Consolidating the highest interest debt into a fixed loan is a great way to combine these two programs. Either way, debt stacking is an effective way to accelerate the repayment of debt that doesn’t require a high priced credit counselor or an excellent credit score to accomplish.

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1 Comment »

  1. Debt Free Seattle

    There are a few ways to do this, and it’s somewhat subjective. Some people simply sort the list so that the highest interest debts are first and lowest interest debts are last.

    Comment by Debt Free Seattle — June 13, 2010 @ 10:40 pm

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