The easiest way to tackle your debt

Let's face it: debt sucks. It feels like a heavy burden on your shoulders, and the idea of paying it all off can be overwhelming. Where do you start? Which debt do you pay off first? And how do you keep track of it all? Fortunately, there's a simple, motivating way to tackle it: the Debt Snowball Method .

In this blog, we'll explain exactly what it is, how to get started, what the pros and cons are, and how you can combine it with handy tools like our budget binders andcash stuffing accessories .

What is the snowball method?

The snowball method is a way to pay off your debts where you start with the smallest debt, regardless of the interest rate. You list all your debts, from smallest to largest. Then you pay the minimum amount on all but the smallest. You then put anything extra you can afford on the smallest one. Once that one is paid off, you move on to the next.

You're essentially rolling your repayments over to the next debt, so the amount you pay off each month keeps increasing. Just like a snowball rolling down a hill, it keeps getting bigger.

Why does this work so well?

The biggest advantage of the Snowball Method is psychological. By achieving small, quick successes, you stay motivated. You see progress, you feel good, and that gives you the strength to keep going. It's not necessarily the least interest-paying method (that would be the Avalanche Method), but it is the method most people stick with.

How do you start? A step-by-step plan

Step 1: Map out all your debts

Grab a pen and paper (or better yet, one of our budget planners ) and write down all your debts. Think about:

• Credit cards
• Personal loans
• Overdraft at the bank
• Outstanding invoices or overdue payments

Set per debt:

• The total amount
• The minimum monthly payment

Step 2: Sort your debts from smallest to largest

Ignore the interest rates for now. You'll focus on paying off the smallest amounts, as those will give you the quickest sense of satisfaction.

Step 3: Pay the minimum amount on all debts except the smallest one

Continue paying the minimum amount on all debts to avoid defaulting on payments. Allocate the remainder of your available budget to the smallest debt.

Step 4: Pay off the smallest debt as quickly as possible

If necessary, use your cash stuffing method here to set aside money in a targeted manner. Once that debt is paid off: celebrate! 🎉

Step 5: Repeat the process

Now, take the amount you initially paid on the smallest debt and add it to the next one. This way, your monthly payment grows—like a snowball.

Practical example

Suppose you have the following debts:

• Credit card A: €200 - €25 per month
• Outstanding invoice: €500 - €30 per month
• Personal loan: €2,000 - €60 per month

You pay the minimum amount on everything, but you put an extra €100 into Credit Card A, for example. That's gone after two months. Then you have €125 per month (€25 + €100) to put toward the outstanding balance. That's gone much faster. And so on until everything is paid off.

The Benefits of the Snowball Method

• Simple : You don't have to do complicated calculations
• Motivational : You achieve results quickly and feel good
• Clear overview : With a repayment tracker you can see exactly where you stand
• Flexible : You can combine it with other methods such as cash stuffing

Are there any disadvantages?

Sure, let's be fair:

• You may pay more interest than with the Avalanche Method
• It requires discipline and perseverance
• Sometimes it can be difficult to stick to the strategy if you have large debts with high interest rates

But if you find that motivation is your stumbling block, then the Snowball Method is a really great way to regain control of your finances.

Helpful tips to make your Snowball successful

• Use a physical budget binder to keep an overview
• Work with cash envelopes for specific purposes such as repayment
• Make a reward for yourself for every debt paid off
• Share your progress on social media or with a buddy for extra motivation