Do you ever feel unsettled by your debt?
…almost like you’re a prisoner to it sometimes?
Then you look at how long it’ll take to pay off and you get caught up in “but that’s such a long time away” feeling.
We’ve all been there.
And the truth is, paying off debt can feel overwhelming.
Interest rates. Car loans. Credit cards. Student loans. Debt snowball. Debt avalanche. Repayment time. Etc. Etc. Etc.
It’s stressful to think about it all, right?
We’ve got you covered. Today, we wanted to share our free debt snowball printable with you. Because it’s time to get that debt burden off your back once and for all.
Best of all?
The debt snowball worksheet is free.
Ready? Let’s jump in.
What is the debt snowball payment plan?
The debt snowball involves tackling your debt from the smallest to the largest balance.
The idea is simple:
List your debts from smallest amount to largest amount. Pay as much as you can towards the smallest debt while making minimum payments on everything else.
Once you’ve paid off your smallest debt, then you move up to the next smallest debt. Keep going until you’re debt-free.
Here’s an example of how that looks:
When you’re listing your debts from smallest to largest, you’ll want to include the minimum payment beside it.
Next, you’ll set up your debt snowball worksheet like this:
(Above: Order your debts from smallest to largest, left to right.)
In the example above, you’d focus on throwing as much money as you possibly can towards the MasterCard. ($600) This means picking up extra shifts, selling stuff you don’t need, and side hustlin’ your way through.
Both the Visa and the Car Loan only receive minimum payments.
Once you’ve paid off the MasterCard, you’d take its payment ($600) and add that to the Visa minimum payment ($50)
$600 + $50 = $650
You now have a new monthly payment for Visa of $650
Here’s how that looks:
And finally, once the Visa is paid off, you’ll add the $650 Visa payment to the minimum car loan payment ($325)
$650 + $325 = $975
By the time you reach your last debt, you’ll be throwing a whopping $975 at it each month.
Why is it called the debt snowball?
Imagine a snowball rolling down a hill. It starts off small, but it adds layers of snow as it continues rolling. With each layer added, the snowball gets bigger and bigger.
This helps it gain momentum. And by the time the snowball hits the bottom of the hill, it’s grown to the size of a boulder.
This is the same theory used with the debt snowball method. Start small. As you pay off your smallest debt, you increase your momentum by adding that payment to the next smallest debt.
By the time you’re on your last debt, you’re hitting it with an extra-large payment each month.
Note: The Debt Snowball should include everything except your mortgage. Your mortgage is “good debt,” so pay that off last.
Resources to help you with your debt snowball
When you’re gazelle intense about becoming debt-free, it helps to have a few tools under your belt.
Here are some great options for getting started:
1. Debt Snowball Printable
This debt snowball tracker is completely free and a great starting point for beginners.
2. The Total Money Makeover
While the concept of the debt snowball is nothing new, Dave Ramsey was the personal finance expert who really popularized it – and helped thousands of people get out of debt because of it.
His book covers more than just the debt snowball method. Dave walks you through his entire 7 step process for financial freedom.
1. Save $1,000
2. Debt Snowball
3. Build a 3-6 month emergency fund
4. Invest 15% of your income towards retirement
5. Build a college fund for your kids
6. Pay off your mortgage
7. Build wealth by investing
The Total Money Makeover is perfect for when you need an easy-to-understand plan for managing your money.
3. Easy Money Spreadsheets
If you’re a spreadsheet person, you should consider using our Easy Money Spreadsheet. It’s an entire financial toolkit that includes everything you need to win with money.
Your toolkit comes with 4 things:
- Debt Snowball Template
- Budgeting Template
- Savings Tracker
- Bill Pay Checklist
Debt Snowball Template:
Bill Pay Checklist:
It’s fully customizable and compatible across all platforms (Excel, Google Sheets, Numbers for Mac, Apple and Android phones)
You can read more about this debt tracker spreadsheet here.
Does the debt snowball work? What the research says.
There are two popular debt pay off methods:
1. The Debt Snowball
2. The Debt Avalanche
And there’s a lot of debate online about which method is better. So before you start working on your debt snowball printable, it might be helpful to see what the research says.
Research from Northwestern University:
This 2012 study showed that you’re more likely to stay motivated if you focus on the smallest balance first.
“This debt snowball approach is believed to increase the likelihood of getting out of debt, as it keeps people motivated through small victories.”
Research from The Journal of Consumer Research:
At the Harvard Business Review, researcher Remi Trudel says he found the debt snowball to be a more effective way of tackling debt, over other methods like the debt avalanche.
Here’s what he said:
“Focusing on paying down the account with the smallest balance tends to have the most powerful effect on people’s sense of progress – and therefore their motivation to continue paying down their debts.”
The same study found that we need to see a noticeable improvement to stay motivated. So if you focus on paying down the largest debts first, then you have a higher chance of getting discouraged.
Research from Texas A & M University:
“In the area of financial decision-making, self-control issues are significant and can plague even the most financially literate,” said Alexander Brown and Joanna Lahey.
They continued to say:
“People also tend to be easily overwhelmed by large amounts of debt and perform better when tasks are broken up in smaller pieces.”
What has worked for our readers?
Still on the fence?
If you’re still not sure if you should start using your debt snowball printable, then it might help to know what other people think.
So we asked our readers:
Is the debt snowball working for you? Why or why not?
Here’s what they said:
“The debt snowball is working for me because of the mental aspect. Paying off my debts smallest to largest is keeping me motivated.” – Janelle
“I’m enjoying seeing my progress with the debt snowball method. If I didn’t have this plan in place then I might have a difficult time staying on track.” – Adam
“I use to throw my money at my debt without a real plan in place. After a few months of feeling like I was getting nowhere, I decided to switch to the debt snowball method. Now I actually feel like I’m making progress. It’s a big help.” – Monica
“The debt snowball worked for me. It helped me change my behavior in the beginning. I started with the snowball then switched to the avalanche to speed up the process.” – Derrick
Track Your Progress With This Debt Snowball Printable
Ready to get started? Grab your free worksheet: