How to Use the Snowball Method to Pay Off Debt (Australian Guide 2025)
How to Use the Snowball Method to Pay Off Debt (Australian Guide 2025) If you’re juggling multiple debts and struggling to stay motivated, the Snowball Method could be your best solution in 2025. It’s simple, powerful, and helps you stay focused. What Is the Snowball Method? The Snowball Method involves paying off your smallest debt first — regardless of interest rate — while making minimum payments on all others. Once the smallest is paid off, you move to the next smallest, and so on. Why It Works Psychological Wins: You get small wins early, keeping you motivated. Momentum: Like a snowball rolling downhill, your progress gets bigger and faster over time. Steps to Follow List all your debts from smallest to largest (ignore interest rate) Make minimum payments on all debts Throw extra money at the smallest debt Once it’s paid off, roll that amount into the next smallest Example: Credit Card 1: $600 Car Loan: $3,000 Credit Card 2: $4,500 P...