Debt Snowball Helped Us Pay off $6,000 of Debt in 6 Months

Debt Snowball Helped Us Pay off $6,000 of Debt in 6 Months

I have said it before and I’ll say it again, the day I got comfortable talking to my husband about our finances, was one of the biggest sighs of relief of my life. For years we went to church and listened to them talk about some of the best Dave Ramsey methods to payoff debt. When we finally buckled down and gave it a go, we were surprised at just how easy it was. We have implemented budgets, get out of debt strategies, and better ways to save. I have included easy to follow printouts in my Fun Sized Budget Bundle on all the methods we use to keep our finances on track, so you can take full advantage of these practices as well. Right now I’ll show you how the debt snowball helped us pay off $6,000 of debt in only 6 months!

*This post contains affiliate links. For more information, see my disclosures

Getting help with debt!

When you have serious debt, there are three options you have to help you tackle it before starting the debt snowball:

  • Take out a loan: If you have multiple debts and/or are being charged high interest on your debt, look into taking out a larger loan, with lower interest to help you pay off your current debts. After paying off our $6,000, Tom and I chose to take out a loan, with a lower interest rate to help us pay it off in faster time! You can get pre-approved for free online. Here are some of the best places to get approved online:
    • The Loan Exchange – Starting at 16% APR. Easy to qualify for up to $100,000 in personal loans.
    • Personal Loans – For loans over $4,000 get a 12% APR and qualify for up to $35,000.
  • Dispute your debts: If you are struggling to get out of debt, the first thing you should consider is getting a free credit analysis. You can get some serious guidance and help when it comes to managing your current debts, and find out how much you could be saving on your monthly payments! You may even be able to dispute some of your debts and even get them removed!
  • Check your credit score:
    • MyFICO: Get a check up on your FICO score
    • CuraDebt: Easy to read reports and free credit monitoring
    • Borrowell: Free credit report check (Canada)

Before you start the debt snowball

If you are ready to tackle your debt with a proven, highly effective method, then let’s talk about Dave Ramsey’s Debt Snowball.

I’m going to try to keep this cut and dry. The basic idea of the debt snowball is starting small and accumulating more and more (payoff) as you go. First of all, you’re going to need an extra $200 per month. –That’s the zinger. That was what took Tom and I so long to actually hop on board with the Snowball Method. We didn’t have an extra $200. Or at least we thought we didn’t. If that is your first thought as well, take these 3 steps:

  • Calculate your spending.

    • Add up your “must have” costs, like mortgage, gas, electric, water
    • Then, add up your “extras” like cable, Netflix and gym memberships
    • Now, the real kicker, go through the last month’s statement and add up all the “really extras” like takeout, fast food, coffee, movies, shopping etc.

Chances are, somewhere in here, you can find an extra $200. I was blown away when we added up our “really extras” to find how much we spent on quick trips to Target, (go figure) Taco Bell or coffee shops. If you are blowing I highly recommend taking advantage of my budget bundle to help you get your finances in order. If you are struggling to set aside money each month, consider using Sinking Funds. It has helped our family keep track of our grocery, repairs and gas spending and helped us improve our financial situation immensely so we aren’t constantly going over budget.

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Finding your $200

It can be stressful trying to come up with an additional $200 per month. Maybe you have already cut your memberships, you don’t have cable and don’t know what else to do. There are actually companies that will do this for you! Trim looks at your accounts and checks for recurring payments (like cell phone, internet and cable) and they work to find your discounts or cheaper options!

The best part is, it is easier than ever these days to find ways to earn additional income. Here are some great ideas to get your starting finding extra money.

Personally, I have always been able to find very part-time jobs (5 hours a week) that easily brought in an extra $200 a month. Scope out your local newspaper for these types of jobs.  Sometimes you may pick up a few extra dollars from work, then a few more by selling some things. It’s important to keep track of how much you’re bringing in so you can make sure to put that money in the right place!

Budget smart

Get access to my Fun Sized Budget Bundle, where you can get an updated Snowball Method printout along with 17 other helpful budget, savings and finance sheets! You can also join the Fun Sized Budgeters Facebook group where you can ask questions and get advice from others who are going through the same things you are!

Another super awesome option is to start your own small business. If you enjoy photography, typing, makeup or fixing up old furniture etc, you can easily get creative and find a way to make your hobby a profit. Like a blog for example! See how I created my own income from home by starting a blog.

Starting the debt snowball

Now that you have your $200 extra per month, let’s talk strategy. Here is your basic starting sheet. *You can download your printout at the end of this post*

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In the top column, write out your debts with the biggest debt being in the #1 box. The #2 box will be your second largest, and so on and so on. Below each of these fill in your total balance owed for each. Then below that, fill in what the minimum monthly payment is for each. Now, you are going to take your $200 and apply it to your smallest debt first.

Our smallest debt plus $200

As you can see, our $300 credit card was our smallest amount.

Our minimum monthly payment was $30.

We added the additional $200 to that $30 and were able to pay $230 toward our $300 total.

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When we didn’t use the full $200

After we finished paying off that remaining $70 from our credit card, we took the remaining $160 and applied it to our $100 payment for our hospital bill. So we applied $260 to our hospital bill in January.

Then by February we had our original $30 (from credit card #1) + $200 (snowball money) +$100 (hospital bill)= $330 to begin applying to our hospital bill. As you can see, that $330 easily paid off the remaining balance with $20 left over to add to our next debt. Are you starting to see the snowball effect?

By May we were able to put $530 toward our big credit card.

debt snowball, payoff debt, snowball method, dave ramsey, debt sheet, printable, snowball method worksheet,Now we have racked up a huge snowball and it just rolls fast and faster knocking out debt one step at a time. By the time we got to our biggest debt it only took a little over a month to completely polish off that remaining balance and we still managed to have an additional $210 leftover.

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Debt snowball is over!

Now, at the end of this 6 month snowball, we found ourselves with an additional $930 a month! Even if you skim off that additional $200, there is still a $630 surplus in our bank account each month!

The Dave Ramsey debt snowball method definitely requires discipline but has a huge payout if you can stick to it! It has been over a year since we were able to dig ourselves out of this much debt. I am still amazed at how easy it really was and how great it felt to watch those numbers get smaller and smaller each month.

I’m done with debt…now what?

Once you have finished your debt snowball, you will find yourself a ton of extra money each month! The worst thing you could do with this is immediately start spending it. Instead, look into some of the best and smartest savings options available.

Smart savings ideas

Join my FREE Facebook budgeting group

Don’t Forget to PIN This!

This awesome debt payoff strategy REALLY WORKS! Best way to pay off debt!

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About The Author

Renee

Renee is the blogger behind The Fun Sized Life. After downsizing with her family, she also took the time to get serious about he finances. Now she is sharing the wealth with all of her readers.

24 COMMENTS

  1. Gloria Harvley | 9th Nov 17

    This is really awesome! I’ve used the Dave Ramsey Method before but didn’t always stick with it. I definitely can ‘t wait to try this method!

    • heartsoulwhole@gmail.com | 9th Nov 17

      Same here! When we did stick to it though…ahhhh feels so awesome to be done with all of that debt.

  2. Lauren | 9th Nov 17

    Holy moly, that’s incredible! I have heard of this method before but I haven’t used it yet. Thank you so much for sharing this story, you have inspired me to check out my finances tonight!

    • heartsoulwhole@gmail.com | 9th Nov 17

      You are welcome. I hope you can find some wiggle room to make some improvements!

  3. Kim | 9th Nov 17

    Love this! My family is debt free, but we weren’t ALWAYS that way. I will be sharing this with my not so financially sound friends as well!

    • heartsoulwhole@gmail.com | 9th Nov 17

      That’s awesome to hear! Talk about life goals!

  4. Prerna Garg | 9th Nov 17

    Getting a side hustle and creating a monthly budget really helps multiply the income and work on the debts. Really helpful post!

    http://www.allshethings.com

    • heartsoulwhole@gmail.com | 9th Nov 17

      Thanks! Glad you liked it! Have a good day!

  5. Kristin | Life of Stones | 9th Nov 17

    Wayyyyy to go!!!! We recently paid off $35,000 using Dave’s steps…feels so great! Congrats to you!!

    • heartsoulwhole@gmail.com | 10th Nov 17

      That is awesome!! How exciting for you guys!

  6. Sincerely Ophelia | 10th Nov 17

    This is interesting. Def need this for my credit card bills!

    • heartsoulwhole@gmail.com | 10th Nov 17

      Give it a try! It’s really great to watch all those bills fade away!

  7. Mary | 10th Nov 17

    This is really handy!

    • heartsoulwhole@gmail.com | 10th Nov 17

      Thanks so much! Have a great day!

  8. Emma @ Muddy Boots and Diamonds | 10th Nov 17

    Thank you for this breakdown. It’s something I have in mind to do for my credit card. Target and eating out are my downfalls. I’m really trying to cut back on the eating out. And I gave myself a pat on the back for returning something to Target and NOT buying something else 🙂

    • heartsoulwhole@gmail.com | 10th Nov 17

      That is impressive. I may or may not have made a tiny splurge at Target today too! (face palm) It was in the “dollar section” though so…it’s all good, right?

  9. Eunice Ann | 10th Nov 17

    So helpful. Thank you for this clever idea. 🙂

    • heartsoulwhole@gmail.com | 10th Nov 17

      You bet! Glad you liked it!

  10. Chad | 10th Nov 17

    Very cool idea, thank you!

    • heartsoulwhole@gmail.com | 10th Nov 17

      You bet! Have a good one!

  11. sarah | 14th Nov 17

    hello i was trying to download the printout but it doesn’t have the columns?? is this on my end??

    • heartsoulwhole@gmail.com | 14th Nov 17

      Hi Sarah,

      Thank you for bringing that to my attention! Not quite sure how that happened, but it should be all fixed! I will email you the printout as well to ensure that you get it. Thank you, Renee

  12. Linda | 18th Nov 17

    Need to specify that you need an extra $200 per month. Took me a while to figure this out.

    • heartsoulwhole@gmail.com | 19th Nov 17

      I’m sorry if that wasn’t clear.

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