The debt snowball method is a debt repayment strategy that prioritizes paying off your smallest debts first, regardless of interest rates. This approach creates quick wins that help maintain motivation throughout your debt payoff journey.

How the Debt Snowball Method Works:

1. List all debts from smallest to largest balance
2. Make minimum payments on all debts
3. Apply extra money to the smallest debt
4. Once paid off, roll that payment to the next smallest debt
5. Repeat until all debts are paid

Example: If you have three debts:

• $1,200 hospital bill (0% interest)
• $3,000 credit card (15.9% interest)
• $5,000 credit card (22.9% interest)

Using the snowball method, you'd focus on the $1,200 hospital bill first, despite it having no interest.

Ways to Enhance Your Debt Snowball:

• Transfer high-interest balances to lower-rate cards
• Consider debt consolidation loans
• Negotiate lower rates with service providers
• Generate additional income through side hustles
• Create and maintain financial boundaries
• Add "debt snowflakes" (small daily savings) to payments

Snowball vs. Avalanche Method: While the debt avalanche method (paying highest-interest debt first) saves more money overall, the snowball method's psychological benefits often lead to better success rates. Choose the snowball method if you're motivated by quick wins and need to build momentum in your debt payoff journey.

Consider debt relief options if your unsecured debts would take more than five years to repay using this method.

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