Debt Snowball Method - How to Pay Off Debt Fast!

Like a snowball rolling down a hill, the money available for the target debt starts small, but the debt itself is small. By the time you get to the bigger debts, your “snowball” has grown too!

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Getting Rid Of Debt

If you’ve stumbled onto this page, I have to assume that you’ve already made the decision to pay off debt to some degree. But, just in case you are still half in/half out, be sure to check out my post on why ALL debt stinks for further convincing.

Now that I know for sure you’re fully convinced, let’s talk methodology. You’re probably familiar with a few debt pay off ideologies at least by name. My goal here is to help unpack one in particular so that you can decide if it’s a good fit for you.

That method? – The Debt Snowball

How Does The Debt Snowball Work?

I figure the best way to explain what something is, is to to explain how it works.

The idea behind the debt snowball is simple.

Make a list of all your debts
Order those debts smallest to largest
Make minimum payments on everything except for the smallest debt. Pay all you can on that debt until it’s gone.
Work your way down the list until all your debts are paid in full.
The end.

See? It’s like a snowball rolling down a hill. The money available for the target debt starts small, but the debt itself is small. By the time you get to the bigger debts, your “snowball” has grown too!

Why Does The Debt Snowball Work?

This method works. Period.

Why? Because you’re going to experience wins early and often.

The fact is, we’re all human. We need to feel like we’re making progress. Think about how much more enjoyable it is to read something when you get to turn pages often verses something where you sit on the same two pages for fifteen minutes.

Along those same lines, have you ever stopped to think about why newspapers are laid out so that your eyes travel such a short distance left to right before moving to the next line?

The feeling of progress keeps us going! (What do you think all these headings are for…?)

Arguments Against The Debt Snowball

“Okay, okay,” you say, “but what about interest rates?”

Fair enough. I do bring those up often on this site. The fact is, mathematically, if you used the debt avalanche method and instead focused on high interest debts first, you MIGHT save some money over the long haul. Maybe.

But, if your highest interest debt also happens to be your largest debt, you might also not experience a “win” for a long time. Do you have the fortitude to stick with a plan for a year before having even one victory?

I’m not saying you don’t. Many do. But you should take the question seriously.

What Really Matters

If you haven’t guessed, I’m a fan of the debt snowball to pay off debt. However, I do not think using the debt snowball is the most important part of paying off debt.

The most important thing to do in regards to paying off debt is to do it. Use this method. Use another method. Make up your own method. But get rid of debt!

Want help?

And as always, regardless of your money goals, you can “Bank on a Budget” to get you from where you are to where you want to be!

The feeling of progress keeps us going!

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Alex

Hello, my name is Alex! I'm a public school teacher who has achieved some big financial goals just by getting control of my money using some simple strategies like using a monthly budget. Now I'd like to share what I've learned with you. Welcome to "Bank on a Budget!"