Like everything else in the world, this technique also has some limitations. These constraints should be carefully examined before applying it on your own. Even though the method is demonstrated to be among the greatest techniques for debt repayment, there can be other variables outside the range of this model, and this article may influence negatively its own application, reducing the savings, or perhaps at times costing more. read more about the Debt Snowball
The first restriction is that the procedure doesn't include interest rates in its decision. If we are talking about economies but dismissing the rate of interest, we're potentially losing out on additional savings that we might be earning. By way of example, if you have two similar sized loans with different interest rates, it can be worthwhile to consider tweaking the strategy somewhat to clear the marginally higher amount higher interest rate loan instead of simply focusing solely on the amount.
Read more limitation of the snowball debt method
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