Debt Snowball Calculator

What Is the Debt Snowball Method?

The Debt Snowball method is a debt repayment strategy made popular by financial guru Dave Ramsey. It focuses on paying off your smallest debts first, while making minimum payments on larger debts. As each small debt is paid off, that money “rolls over” into paying off the next smallest, gaining momentum — just like a snowball rolling downhill.

This method works not because it’s the fastest in theory, but because it builds psychological momentum. Seeing debts disappear gives you a rush of motivation to keep going.

How It Works:

List all your debts from smallest to largest — don’t worry about interest rates.

Make minimum payments on all except the smallest.

Throw any extra money at the smallest debt.

When it’s gone, roll that freed-up amount into the next one.

Repeat until you’re debt-free.

It’s simple. It’s motivating. And it’s a proven strategy for millions.

Real-Life Example: Meet Jake

Jake had four debts:

• $300 credit card
• $1,200 medical bill
• $3,500 car loan
• $8,000 student loan

With the snowball method, Jake focused on the $300 credit card first. He paid it off in 1 month, then used that freed-up payment to attack the $1,200 medical bill. By the time he got to the student loan, he had nearly $400/month to apply — way more than the minimum.

In just under 22 months, Jake was completely debt-free. The snowball didn’t just clear his debts — it built discipline, optimism, and peace of mind.

Frequently Asked Questions

What makes the debt snowball different from the avalanche method?

The snowball focuses on small balances first, while the avalanche targets high-interest debts first. Avalanche is mathematically faster, but snowball often wins in the long run due to psychological motivation.

Can I use the debt snowball if I have large debts?

Absolutely. The method works no matter the size. If you’ve got 5-6 debts of varying sizes, it’s perfect for creating visible progress fast.

Should I stop saving money while using the snowball method?

It's best to keep a small emergency fund ($500–$1,000). After that, funnel extra income into your snowball. You’ll save more on interest long-term by paying down debt now.

Is the debt snowball method good for credit scores?

Yes — paying off debt consistently lowers your credit utilization and shows positive payment history. But avoid closing credit cards too soon after paying them off.

Can couples use the debt snowball together?

Definitely. In fact, team momentum can double your success. Combine finances (or at least strategies), and cheer each other on as debts disappear.

What if I get a windfall or bonus?

Throw it into the snowball! Unexpected income can supercharge your debt payoff timeline and wipe out smaller balances instantly.