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Eliminating debt is one of the four stages to achieving financial freedom, and paying off each balance you owe is a milestone worth celebrating!

Ready to start destroying your debt? Let’s take a look at how the debt snowball method can help you get closer to financial freedom.

What is the debt snowball method?

The debt snowball method means paying off the smallest debt first, and then working on the next smallest balance until all of your debts are paid off. It’s a strategy designed to help you work through debt and build confidence while successfully reducing how much is owed.

What are the benefits of using the debt snowball method?

The debt snowball method can help you pay off your balances as fast as possible. Instead of taking the highest balance head on, knocking off the balance from smallest to largest encourages you to keep going until all the balances are gone.

Why should I make more than the minimum monthly payments?

Rather than making extra payments to pay off the balance faster, carrying balances could end up costing you hundreds – even thousands – of dollars in interest over time. Whenever you can, always make more than the minimum payments.

How can I use the debt snowball method to pay off debt?

Let’s say you’ve squeezed an extra $500 out of your budget to channel toward paying down your debt. How would you use the debt snowball method for a personal loan, student loan, car loan, and credit card?*



Minimum Payment

Personal loan




Car loan




Credit card




Student loan




*Example is shown for illustrative purposes.

For the example above, here is what you need to do:
  1. Pay the minimum payment on all debts except for the smallest, then put the $500 toward quickly paying off the smallest balance: the personal loan.
  2. Once that’s paid off, take the extra $500, plus your previous $50 minimum payment, and roll that into the $200 car loan minimum payment. Now $750 is funneled toward the car.
  3. Continue doing this until every balance is destroyed on the list.

Keep in mind: Regardless of which balance has the lowest rate, always pay off the smallest balance first. This can help you keep your momentum rolling as you pay off each outstanding balance.

I’m ready to start attacking my balances! What should I do next?

Crunch the numbers with our free debt snowball calculator to see how quickly you can gain momentum to destroy each balance. Along with your results, you’ll get a complimentary, personalized month-to-month plan to keep track of your progress and stay in control of eliminating your debt.

With the combination of debt snowball method and your very own roadmap by your side, you’re closer to achieving your milestones – and financial freedom.