Debt Payment Schedule: Debt Snowball

Do you have multiple debts you want to pay-off, and pay-off quickly? There is no better way to get rid of debt than by using the debt snowball method. I originally heard of the debt snowball from the Dave Ramsey show and have found it quite useful in getting debt under control.

The jist of the snowball is quite simple.

1. Write out the list of current debts and payments.
2. Focus on one of the accounts ( usually the lowest balance or highest rate) and add additional amounts to pay off that loan

3. Continue to pay the minimum payment on the others debt

4. As soon as the first loan is at 0, roll what you were paying on that debt into the next loan

5. Continue to roll your payments as each loan is paid-off

It's important to have a Debt Payment Schedule to track payments and timelines. A comprehensive  schedule is available on this site for downloading.  A training video on using the Debt Payment Schedule is available on the Simple Saving Habits YouTube channel.

Simple Savings Habits YouTube Channel

Quick Summary on how to use the Debt Payment Schedule

1. List out all of your current debts

2. Determine how much each month you can contribute as an additional Payment, aka Snowball

3. Rank debt by importance of being paid off

4. 
   Optional: Breakout the Snowball amount among the debts to compare between payment methods

5. Using the Snowball Schedule Tab, toggle between the two options to see which is best for you.
1. You can continue to play around with the rank and new payment to create the best option for your payment plan

6. Once you found the best approach for debt repayment - Print off the Snowball Schedule  to keep you on track
1. If you are able to make additional payments during the repayment time period, note those extra  payments in the schedule. This will help decrease interest paid on loans, and decrease time it takes to pay off the loan(s).
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