Debt Free LivingSample

Use a debt snowball calculator to help you understand how paying off your debts early can save you money. 

The Debt Snowball Strategy Summary

Pay off your smallest credit card debt.

Review your credit card debts. In addition to making the minimum payments on all your cards, focus on accelerating the payment of your smallest high-interest credit card first. You will be encouraged as you make progress, finally eliminating that debt.

After you pay off the first credit card, apply its payment toward the next smallest one.

After the second card is paid off, apply what you were paying on the first and second toward the third smallest credit card, and so forth. That’s the snowball strategy in action!

Pay off your smallest consumer debt.

After you have paid-off all your credit cards, focus on paying off your consumer debts, like auto and education loans, in exactly the same way as you wiped out your plastic. Make the minimum payments on all your consumer debts, but focus on accelerating the payment of your smallest higher-interest consumer debt first.

Then, after you pay off the first consumer debt, apply its payment toward the next smallest one. After the second one is paid off, apply what you were paying on the first and second to pay off the third, and so forth. This method will provide small successes to keep you motivated, and the ever-increasing payments will accelerate the payoff of your largest debts.

Many people delay paying creditors until payments are past due, even when they have the money. This, however, is not biblical. Proverbs 3:27-28 reads, “Do not withhold good from those to whom it is due, when it is in your power to do it. Do not say to your neighbor, ‘Go, and come again, tomorrow I will give it’—when you have it with you.”

People should pay their debts and bills as promptly as they can. Some Christians try to pay each bill the same day they receive it to demonstrate to others that knowing Jesus Christ has made them financially responsible.