The Biggest Challenge
The biggest factor keeping American borrowers in debt is the tendency to make only minimum payments over time. As we explain in the following article, if you make only minimum payments, it can take 15-20 years to pay off your credit card. If you hold your payment constant at the current minimum payment, you can pay it off in 3-4 years and save thousands of dollars in interest.
The DebtGoal Approach
The most efficient way to get out of debt is to set a monthly amount to be applied to debt each month and then allocate as much as possible toward the highest interest account. This approach is often called Debt Stacking and you can learn more about this approach in our article: Paying Off Debt More Quickly With Debt Stacking. Of all the things you can do to reduce your debt, just making a constant monthly payment yields approximate 75% of the result. All the other actions we tend to focus on such as balance transfers, reducing APRs, consolidation loans, etc. generally contribute about 25% to success.
Although it’s simple in concept, following a debt stacking plan requires that you calculate a new payment schedule each month. Managing such a plan can be complicated and time-consuming. This is where we come in. We’ve designed DebtGoal to address the biggest challenges that people have in getting out of debt: getting organized, creating a plan, tracking progress, staying motivated, and knowing what to do.
Using DebtGoal
In this user guide, we will walk you through how to set up and use DebtGoal to gain control and make progress on your debt.
Getting Started
Enter your accounts: After you create a user account, DebtGoal will prompt you to add your debt accounts starting with your credit cards. You can download your account information using AccountLink or add the information manually. As you add your accounts, DebtGoal will show you how much you can save in interest by following a plan. Click here to learn more about adding Accounts. After adding your information, DebtGoal will take you to your MyDebtPlan page. This page is your central workspace for managing your debt. It shows your balances, your payments, payment dates, and action buttons showing you the next action to take on the account. One of the accounts will have a bullseye icon next to it – this is your Target Account, the account that has the highest APR and you will pay off first. On your first visit to the MyDebtPlan page, you can click on the Monthly Commitment tab to see how long it will take you to pay off your debt and how much interest you will save compared to making only minimum payments. The amount that you commit to paying each month is called your Monthly Commitment. 
Set your Monthly Commitment: Your Monthly Commitment is the total amount that you will pay to your debt each month, holding this amount constant rather than letting it decline as your credit card minimums decline. On your first visit, DebtGoal defaults to the current sum of your minimum payments. This is the minimum that you need to pay today. From this point, you can experiment with the slider to alter your Monthly Commitment to see how this impacts your Debt Free Date and your total interest savings. To fine tune, you can place your cursor over the slider bar and use the LEFT and RIGHT keys to increase or decrease the amount. When you have chosen an amount that you feel that you can comfortably pay each month, click on the [USE THIS MONTHLY COMMITMENT] button to set your total monthly payment.As explained in the this article on Debt Stacking, DebtGoal constantly reallocates your Monthly Commitment to your various debt accounts to pay as much as possible toward your Target Account and minimum payments on the other accounts.
Using DebtGoal
Your DebtPlan is the primary application to create and manage a plan to pay off your debt.
Monthly Progress Tab: in this area, your DebtPlan will create an optimal debt payment schedule to reduce your total interest costs and pay off your debt most quickly based on the amount you wish to apply to debt each month (Monthly Commitment) and the required payments on your accounts. To follow your DebtPlan, simply perform the actions when prompted.
Actions you can take include:
- Add Statement: enter your most recent account statement. Statements are displayed in the month in which the payment is due.
- Edit Statement: change the information is a previously-entered statement
- Add Payment: enter the amount of payment that you have made against the account. Your DebtPlan will recommend and optimal payment amount for your situation.
- Edit Payment: change previously-entered payment information.
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Link/ Unlink Account: set up or deactivate automatic download of your online accounts using AccountLink feature. Click here to learn more about adding accounts to your DebtPlan.
When you make a payment, your DebtPlan will show you the amount of principal you will pay off and the total interest you will save over the lifetime of your loan as a result of making the payment.
