Debt Snowball – frequently asked questions
Millions of people who decide to use the Debt Snowball as their debt repayment method know it’s the fastest, most motivating way to clear debt.
If you’re new to this debt repayment method, you may have a few questions…..and we’ve tried to answer them here. If you have a question we’ve not answered, please get in touch here!
What IS a debt snowball?
A debt snowball is a way to repay your debts. The idea behind this strategy is that you start your snowball small, paying the smallest debt first, then get bigger, as you free up more minimum payments (as you pay each debt off) to add to the next smallest debt.
This is where the name comes from. You keep ‘rolling’ your debts until you’re all paid up and debt free.
How do you calculate my debt freedom date?
*ALL DEBT FREEDOM DATES ARE ESTIMATES AND SHOULD BE TAKEN AS SUCH
We calculate your debt freedom date by combining several factors.
Some of these factors are: the total debt balance and the interest rate on any credit cards, because this affects how much of your minimum payment goes towards clearing your debts. We also use your minimum payments in the calculation. We then cross this with typical debt averages.
BUT….and it’s a really big but, it’s important that you know that there’s not a single Debt Snowball calculator that’ll be able to give you a truly accurate date when you will be debt free. This is because the point of a Debt Snowball is that you make extra payments where you can. You might sell a car, clothes. You might get a side job to clear your debt quicker. We, nor anyone else, are able to give you a more accurate date.
The good news is that the debt freedom date calculator is a worst case senario. We’re pretty sure you’re going to get debt free WAY sooner!
We have a Debt Snowball calculator in our App. We also have one here in case you’ve not downloaded the App yet 🙂
Why don’t you pay the debt with the highest interest first?
It’s a good question and we get asked this a lot. The problem with paying the highest interest first is that this might mean that you’re tackling a large debt at the beginning, or very near the start of your debt free journey. Research shows that if people feel as though they’re not making progress quickly enough, they give up.
We feel it’s better to be inspired to get debt free and motivated by seeing progress to carry on, than disappointed with the slow speed and give up. The debt snowball has a lot of research behind it, and the psychology of seeing fast progress seems to be why this method of debt repayment is so successful.
Will I pay more interest using a debt snowball than another method of debt repayment?
Without seeing your interest rates I couldn’t say for certain, but it’s definitely a possibility, yes. However, over 5 million people have used the debt snowball method to get debt free and have stayed motivated by the speed of progress to carry on and see it through, all the way to debt free, and ultimately saving a ton of interest.
How can this App help me?
Our App was created out of our very own debt free journey. I wanted to have a visual tracker of where we were in the process, how far we’d come and how far we had to go. Seeing the balance reduce as soon as I made a payment to our snowball was very motivating.
This App will track your journey to debt free, show you how far you’ve come and how far you have to go.
Where can I download the App?
Glad you asked. You can download it here!