When you are struggling with debt, it can totally seem like this thing you will never get rid of.  It feels impossible, and if you are like me, you don’t even know where to start. Why does it matter if you are in debt?  Can’t you just keep living life like you always have?

Excellent questions!  So, the big deal with debt is, you are constantly giving your hard-earned money to someone else.  Every single month, you are taking a substantial portion of your income and paying it out to cover something you purchased in the past.

What would your life look like if you had no payments?  How much of your money would that free up?

If you are trying to build wealth and get ahead in life, you need your income to accomplish that.  If you have debt payments, you are missing your entire income! What a waste!

When you decide you want to completely ditch your debt, you need to find your “why” to make sure you stay motivated during the process.  

Use our Debt Free Goal Setting Worksheet to write down where you want to see yourself and create a reminder of why you are doing this.  Get it instantly for FREE when you sign up below.

If you are going to pay off debt, you have to have a plan.  If you try to just spread out your income over lots of different payments, you are going to fail.  It’s like the phrase, “Jack of all trades; master of none.”

If you try to pay off everything, you are going to pay off nothing.

The plan I believe will work the best is called the Debt Snowball.  Why do I think this will work? It totally worked for me!

Instead of looking at all of your debt in one huge pile just staring you down; the debt snowball will show you how to approach your debt in a way that will actually help you make progress.

How the Debt Snowball Works:

Step 1.  List all of your debts (not including your home) from smallest to largest.

Write down any debt that you have:  

• personal loan,
• a private loan,
• government loan,
• car loan,
• furniture loan, etc.

Put them in order from smallest amount to largest amount.  Do not pay attention to interest rates. It’s nice to know what they are, so write them down next to the debt amount, but the rate won’t determine where you put the debt on your list.

Your list could look something like this:

Step 2.  Write down the monthly payment due for each loan.

This part is very important because this is how you will start to build your snowball!  

This will look something like this:

Step 3.  Make minimum payments on all debts except for the smallest one.

Ready to make some progress??  You are going to focus all of your efforts on your smallest debt.  This means every extra dollar you can squeeze out of your budget will be thrown at this smallest debt to pay it off as fast as humanly possible.

If you are wanting to move fast:

• try to cut your expenses,
• budget meticulously,
• sell your stuff or
• even pick up a second or third job.

Step 4.  Build your snowball.

Once your smallest debt is paid, you will then take the minimum payment you were making on that debt and add it to the next smallest debt.  Then you will do the same thing and focus all of your money on paying off this debt.

This will look something like this:

Step 5.  Keep that snowball rolling.

Once that debt is paid, roll that payment into the next smallest debt.  You continue to do this until all your debts are paid!

See how awesome this is!  Before you know it, you will be completely debt free.  Then YOU will be in complete control of your income.  For funsies, you can calculate how soon you can be out of debt!

Using the debt snowball will help keep you laser focused so you can get rid of your debt once and for all.  If you are trying to pay off everything at once, you are going to fail. When you focus all your efforts on one debt at a time and build up your payment debt by debt you are going to be successful.

Use our Debt Snowball Calculation Sheet to get your snowball set up today!  You can get it right now by signing up below.

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