MODULE 6

4. Debt Snowflake Method

Steps for Debt Snowflake Method

  1. Look for ways to save money throughout your month, or find ways to make a little extra cash here and there.

  2. Once that money is saved or secured, transfer it into your debts either by putting them into your savings or making direct payments on the spot.

  3. This can be used along with the Debt Avalanche or Debt Snowball method for a more effective way of paying off what you owe.

PRO:

This is a super simple way to pay off debt. You can use it in addition to another method, and it’s very straightforward. It’s a really great method for someone who enjoys frugality!

CON:

It can be tricky to keep track of the small amounts of money you’re able to save. If you’re charged any fees for transferring money, it can be costly to use this method. Using a dedicated savings account for this can be helpful.

Ultimately, it’s better to have a plan than nothing at all. Instead of stressing out about this, just pick a method and give it a try. If it doesn’t work for you, there’s no shame in switching it up later!

Time to Choose!

Struggling With Student Loans?

Here’s what to do:

  1. Contact your loan provider. No, seriously. Call them! They can go over your options with you and make sure you stay in good standing.

  2. If you’re experiencing financial hardship and need to get back on your feet, ask about deferment or forbearance programs. Usually federal and private student loan borrowers have access to these. Make sure you understand how your own situation works so that you know how much interest you’re responsible for paying.

  3. Change your repayment plan. Check out your options and see if you’re able to switch to an income-driven repayment plan. Do be aware, however, that this could lead to you paying more interest over time. Do the math before you decide to change plans and really weigh your options.

  4. Research your consolidation options. Again, this could increase the interest you pay over time, so only do this if you’re in need of relief and lower monthly payments.

You should do everything you can to avoid falling behind on your loan payments, because this will destroy your credit. You should now have a complete strategy for paying off your debt and the motivation to become debt free!