The Debt Snowball

Any amount of debt can feel like a growing burden, but you don’t have to stay under it!

The most common approach to reducing debt is called the Debt Snowball. Many people have used the concept under the same name or a slightly modified title, but the premise is the same. Like a snowball rolling down a hill, the further it goes, the larger it becomes. By the time it reaches the bottom, it is a massive snowball taking down everything in its path.

To get out under all debt, pay the minimum on all balances and use any extra money available to attack the smallest debt first.

Here’s how it works.

If you are going to find relief, you must reduce your current debt by making a persistent and progressive plan. As you establish this plan, remove the opportunity to go into further debt by fighting for contentment and planning for spending.

Utilize the Debt Snowball effect by paying off your debts (not including your home mortgage) in order of the lowest to the highest balance. With each successful debt removal, apply the completed payment to the subsequent debt.


Let’s take some round numbers and look at a possible scenario.

  • $500 medical bill – $50 payment
  • $2,500 credit card debt – $63 payment
  • $7,000 car loan – $135 payment
  • $10,000 student loan – $96 payment

If you paid the minimum, you would maintain these debts for 10 years and 10 months. If you had an extra $500 each month, you could pay off all of your debt in 27 months. You heard me right. While I know $500 may not be easy to come by, if you picked up some extra work, ate out a little less, and got lean on some frivolous spending, you could reduce the debt in no time. With an extra $500 a month, you could shave off the life of all those loans by about 9 years!


  1. Pay off the medical bill in 1st month – It was a $50 minimum payment, but with your extra $500, you can get rid of it immediately.
  2. Pay off credit card debt at $613 a month in 4 months – This is where the snowball picks up speed. While still paying the minimum on the other debts, you apply everything you were spending on the medical bill on top of your minimum payment to the credit card. Instead of the minimum $63 payment, you put down $613, and you would knock it out in 4 months.
  3. Pay off the car loan at $748 a month in 10 months – Using the same approach, you would now use all previous money on the smaller 2 debts and apply it to the car loan. While the loan company wants you to pay $135 on the car for a long time so they can continue to earn more money on the interest you pay, you instead pay $748 a month and knock it out in no time.
  4. Pay off student loans at $844 in 12 months – Repeating the same process, you now have $844 to put on that pesky $96 a month payment. In 1 year, all your debt would be gone.
  5. Enjoy being debt-free – You would pay off $20,000 of debt in only 27 months!
  6. Imagine what to do with money to spare – Then, you have $844 unrestricted money every month.

What could you do with an extra $844 a month? A bunch of things! You would have the margin to give, save, bless, enjoy, and then some! Whatever you do with that freedom, don’t get shackled again to the slavery of debt (Prov. 22:7)!

Get Started

You can begin your path to freedom to debt today. Watch that snowball pick up momentum and make a difference!

  1. List all of your debts out. It’s OK to be overwhelmed by it for a while. That might be helpful in the long run!
  2. Order them by amount. Place them in order from smallest to largest.
  3. Pay the minimum on all. You have to do what is right and pay the minimum. There is no way around that!
  4. Pay any possible extra on the smallest. Find extra money wherever you can and apply it to the smallest debt.
  5. Once one debt is paid, apply the entire payment to the next debt in line. Keep stacking up what you are paying as the snowball gets bigger.
  6. Repeat until all debts are paid. Continue to go down the list until there is no more loans remaining.
  7. Refrain from incurring any unnecessary debt. Once you get a taste of what freedom tastes like, don’t put yourself under it again!

You can start today! Take what you got to begin. Even if it is a small snowball at the top, it will increase over time.

The rich rules over the poor,
    and the borrower is the slave of the lender.

Proverbs 22:7