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Many people are eager to eliminate their debt quickly. However, in their rush, they sometimes go too far and worsen their situation. Jason Vitug, the founder of Phroogal, cautions against falling into the "pay, spend, pay" pattern.
In an interview with LearnVest, Vitug shares his personal experience with debt. He explains that it's possible to overpay your debt in an effort to clear it faster.
Vitug found himself trapped in what LearnVest calls the "pay, spend, pay" cycle, where well-meaning debtors make excessive payments on loans or credit cards to get out of debt more quickly. However, this often leads to neglecting other parts of their budget and, in many cases, maxing out their credit cards again because all available funds are directed toward loan repayment.
The article compares this cycle to yo-yo dieting, where a person loses a large amount of weight only to regain it, then loses it again. Rather than creating lasting change, this impulsive behavior keeps you stuck in a repetitive cycle.
For advice on breaking the cycle, be sure to read LearnVest's complete article.
Image courtesy of Morgan.
