The debt snowball method is a GREAT way to get out of debt for those with multiple debts. But you can still use it even when you only have one debt! Here’s how.
The idea is simple.
Suppose you have just one debt, and it’s $250,000.
Taken by itself, that amount is overwhelming. It probably feels like it will take forever. But how long would it take you to pay off $500 of it? $1000? $5000?
A whole lot less time, right?
So the idea is to focus on those smaller amounts instead of the big lump sum.
It doesn’t matter what you’re using, a debt payoff app, a debt snowball calculator, or even just a piece of paper.
The approach is the same.
Break it down into smaller amounts
Break it down into smaller, achievable amounts, and track those instead.
For the sake of this example, let’s imagine your $250,000 debt is a single student loan. You’d enter it this way:
Part 1 – $500
Part 2 – $1000
Part 3 – $5000
Part 4 – $5000
Part 5 – $10,000
and so on until you’ve accounted for the whole amount.
Then you mark each part as mentally paid and celebrate your progress! Because any progress is good progress.
A caveat
Now, if you truly had multiple debts, you’d also increase your payments to the next debt in line as you got the previous one paid off. So this wouldn’t work quite the same way. (Although you could still increase your payments, say, when you get a raise or some extra income.)
But it will help to keep you motivated. And that’s important, because it will help you stick with it. The easiest way to get out of debt is to do two things;
- Stick with it
- Not add to it
Breaking it down this way and really putting your mental focus on your progress can be a big help. So using the debt snowball method when you only have one debt can definitely still help!