Transcript for This couple paid off more than $50K using the debt lasso method
I was just thinking about no question about it. We move to a savvy financial method coined by one couple who got out from under $50,000 debt. Rebecca Jarvis is back to tell us about it. Hey, Rebecca. Reporter: Hey, George. The idea here is to lasso up those debt, pay them down and then ride off into the sunset. Here's how one family did it. David Auten and John Schneider live a post-debt lifestyle. It wasn't always this way. They did by crawling out of over $50,000 in credit card debt. We realized that we were financially living in a hole and we needed to change that. Reporter: After sitting down and looking over their spending habits they realized they needed a way to reduce the thousands they were paying in high interest on their credit cards. When we were looking at the various methods to pay off our credit card debt such as the snowball and avalanche method our estimation was it would take anywhere from eight to ten years to pay off $51,000 in debt. The problem we didn't have the patience to use either of those methods. Reporter: They developed the lasso method for paying down their debt. The first rule they say, commit to the process. Then you have to lasso your debt into as few locations as possible. They recommend finding a credit card with low or no interest and transferring your balances to the new one. Then automate your payments so the debt is paid off before the promotional interest rate expires. For some people that means getting a zero balance transfer credit card. For other people that means a personal loan. Reporter: The best part, they got rid of their debt in three years versus the eight to ten they were expecting. I think our advice to anyone who thinks that credit card is unlimited money, take a look at what happens when you use it. You have to pay it back. It is not unlimited money. Reporter: So true and the key here is that David and John diligently made those payments after they did the balance transfer. This is not an invitation to spend more. You also want to make sure you understand the fees and the make sure the benefits outweigh the costs of a balance transfer and finally, be cautious about that teaser rate. They aren't eligible for every one and they can run out. Lots of good advice, thanks. Back to ginger.
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