Debt Snowball Method

When the smallest debt is paid in full you roll the money you were paying on that debt into the next smallest balance.

Debt snowball method. What Is the Debt Snowball Method. Just like an actual snowball rolling down a hill the idea is the amount you pay towards each debt accumulates over time and your debt is paid off faster. The debt snowball is a great method for paying off debt.

In theory this is exactly how the snowball method of debt repayment works. The snowball method is meant as a habit-building tool for people who find their debt burden psychologically overwhelming. As you knock out smaller debts you get rid of the minimum monthly payments they come with too.

It was awesome going from 15 debt items to 2 now. Once the smallest debt is paid off one proceeds to the next larger debt and so forth proceeding to the largest ones last. 109 A tiny house helped one couple pay off.

Once your first two debts are gone start attacking your third smallest debt. The Snowball Method is designed for people who have multiple debts. As you eliminate one account with this method it frees up more money to put toward the next highest debt.

The debt snowball method is a debt payoff strategy used for eliminating non-mortgage balances. Its name is derived from the idea that you can think about your payoff progress as though its a snowball. If you follow these steps and stick to your payments then you will become debt-free.

In fact its exactly what I used to pay off over 78000 in student loan debt in less than three years. Popularized by The Total Money Makeover author Dave Ramsey the snowball method prioritizes your smallest debts first regardless of interest rate. The Psychology is Powerful.