![Debt Snowball Chart Cover.png](https://images.hive.blog/DQmb1aYdV2sqgFDJovKHNomCZUhGAWF2TYhyJAkyhN3ECG1/Debt%20Snowball%20Chart%20Cover.png)

Debt Snowball is a payoff method used to be free from debts. Paying your debt more than the minimum amount required. Like a snowball, it starts paying off debts from the smallest amount to the highest.

One might argue that prioritizing the highest interest rate debts should be prioritized, but due to the nature of humans, Debt snowball seems to be the most effective.

## How is it more effective?

When you have small amounts of debt, it won't matter. 

When you have several institutions collecting higher amounts of debt, it will be exhausting psychologically. 

Paying them off one by one will give us the feeling of fulfilment which motivates us paying off the other debts until mortgage is the only one left. Like in games where you spend hours to level up, then you feel like playing more until you finish the game.

## Why use Debt Snowball Chart?

By using Debt Snowball Chart, you will see how much you can save from interest and how fast you can finish paying your debts. Long term debts with high amounts such as mortgage are not included here.

## How do I use this snowball chart?

Input the **Start Date** of using Debt snowball.

Then list these details about your debts:

- **Creditor**
- **Current Balance**
- **Annual Effective Interest Rate**
- **Minimum Monthly Payment**

Then check your budget to see how much you can pay monthly for your debts. This will be your **planned total monthly payment**.

![Debt Snowball Inputs](https://images.hive.blog/DQmRa1ZWaxHc4iqb9f4Q2MR8Y7i1WR5f9fTfZqekWKHwCpR/image.png)

In the Snowball Schedule sheet, you can also input the additional or subtracted amount you paid on a certain month. 

![Snowball Other payments](https://images.hive.blog/DQmefhhRDkrGbeMrwtej767rEknJ9xXPA2nHxDakXyLQoab/image.png)

Sample: your planned monthly payment is 500, but you had an emergency expense in month 3 of 20 so you can only pay a total of 480 on that month. So you will write 20 in column D "Emergency Expenses".

![Snowball other payments sample](https://images.hive.blog/DQmZtmgw4Gecc8GscgwyPfBqtz3HpKPGmfbBGroGPakBj9u/image.png)

I also made it easily customizable for these currency.
**$
£
€
¥
₱**

> Cells in yellow are designated for manual input so you can change them.

![Debt Snowball Guide.PNG](https://images.hive.blog/DQmW2JgDasL4nddUtoDzU9eyiydZ9hcUGhDUhASrnzBtK5a/Debt%20Snowball%20Guide.PNG)

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You can order this template on my etsy shop:
[Basic Debt Snowball Template](https://www.etsy.com/listing/1028169339/debt-snowball-chart-excel-template-for?ref=listings_manager_grid)
[Standard Debt Snowball Template](https://www.etsy.com/listing/1405306516/debt-snowball-chart-excel-template-for?ref=listings_manager_grid)
[Premium Debt Snowball Template](https://www.etsy.com/listing/1405310394/debt-snowball-chart-excel-template-for?ref=listings_manager_grid)

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