Why Snowballing Debt is the Best Debt Reduction Strategy

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$38,000 is the average amount of debt (excluding mortgages) an American has, according to a 2018 CNBC.com article. Debt can be so stressful and even cause you to delay your weight loss surgery. You may feel guilty about spending so much money on your surgery when your debt is piling up. It may cause you to stress-eat, which is something we want to avoid. You need to take control of your debt now so that it won’t sabotage you later, and the best way to do it is to snowball debt.

However, there are two popular debt reduction strategies to help you: the snowball method and the avalanche method. By comparing the two plans, it’s obvious which one has the advantage. I’ll even share my own experience with debt reduction and give you a few tips I used to make some progress. Snowballing debt helps eliminate stress in your life, which will reduce your chance of stress eating and ruining your hard work in your weight loss journey.

Dave Ramsey Baby Steps

In this post, I reference Dave Ramsey quite a bit. I am a regular listener of his show, and his biblical teachings on finance speak to my heart. As I lost weight, I grew closer to God. I knew about Dave Ramsey when I first started my bariatric journey, but I wasn’t fully vested in his plan and had yet to read The Total Money Makeover. However, as I progressed in my bariatric journey and radically transformed my life, I knew my finances needed a radical transformation. I believe that Dave Ramsey takes complicated financial principles and makes it easy to understand. He is motivating but also reminds me to stop making excuses.

The more I listen to Dave Ramsey and the people who call into his show, the more I can’t help but make parallels between a debt-free journey and a bariatric journey. People get into debt due to poor financial choices and a lack of financial education. People also get into obesity due to poor nutritional and fitness decisions and a lack of nutritional knowledge. To get out of debt, people need a specific plan to follow, like the baby steps. To get out of obesity, people need a specific plan to follow, like bariatric surgery. There are also many parallels in the emotional response to food and money. Some people shop and spend money when they’re sad, and others eat.

Drug of Choice

Whether your drug of choice is money, food, alcohol, sex, gambling, heroin, cocaine or work, we use these outside influences to heal a part of our heart that isn’t whole. Yet, none of these influences will make us whole. If anything, it’s going to make the hole in our hearts bigger. We need to figure out what we’re trying to soothe with our drug of choice, heal that part of us, and move forward to the life we love. It can take years, but it’s worth the journey.

For me, that hole needed to be filled by God. As I grew into a teenager and young adult, I grew further away from God, creating a God-shaped hole in my heart. Once I returned to church after my bariatric surgery, that hole slowly started to get filled. Less than a year later, I was baptized and became more involved in the church. I cannot tell you how amazing my life has been since God has filled my heart and made me whole again. It’s been incredible, and I stand as a personal testimony to God’s wondrous things in a person’s life. All glory be to God for my success with bariatric surgery, my business and my life.

Debt & The Snowball Method

God has transformed my finances, too, although He first worked on other people to help teach me. When it comes to financial mentors, there are two people to whom I turn. The first is always Rosemarie Groner at the Busy Budgeter. Her blog has changed my life completely, and her 90-Day Budget Bootcamp works wonders. The second is Dave Ramsey. Dave has developed multiple tools to help people reclaim their budgets and get out of debt. He developed a Seven Baby Steps plan to help people get out of debt, and it’s something I started following in the last year or so.

Dave describes the snowball method several times on his Web site. It works by listing all your debts (except your mortgage) from smallest to largest. If two debts have the same or similar balance, list the one with the higher interest rate. Your first step is to attack the beginning balance on your list. Throw any extra money at it that you can. Work a second job, sell some possessions, and get rid of the smallest balance.

Snowball Debt

You’ll continue to pay the minimum on the remaining debts during this time. Once you pay off the smallest debt, you’ll add the first debt’s payment plus whatever extra you were throwing at it to the next debt. For example, imagine your smallest debt is a $50 medical bill with a minimum payment of $10, and the second smallest debt is a $250 credit card bill with a minimum amount of $25. You’ll pay off the medical bill as quickly as possible by throwing extra money at it. Let’s say in two months you paid off the medical bill. Then you’ll take the $10 you were paying on it, and make your minimum payment for the credit card $35, plus whatever extra money you were throwing at the medical bill. If you want a debt snowball calculator, check out this free one from Financial Mentor.

The snowball method is about behavior modification, according to Dave Ramsey. The small wins keep you motivated, and, more importantly, give you hope. When there’s hope, there’s motivation to keep going. Think of it when you first started your weight loss surgery journey. You began by making small changes to your habits. These small changes led to a significant loss on the scales, thus motivating you to continue changing habits to continue losing weight. The snowball method does the same thing with debt. You make small wins by paying off small debts, which leads to a significant reduction in debt quickly. As you snowball debt, your debt reduction keeps you motivated and makes you feel like a debt-free life is possible.

Debt & The Avalanche Method

A second debt reduction strategy is the avalanche method. You’re going to list your debts again, but this time, in order of highest interest rate to the lowest interest rate. You’ll attack the debt with the highest interest rate first. This method’s thought is that you’re saving money on interest, and it’s true, you will. However, according to Dave Ramsey, it could take a while to see any progress which leads to burning out.

Say, for example, you have a credit card with a $500 balance at 7.5% interest and a store card with a balance of $2,000 at a 19.99% interest. Using the avalanche method, you will attack the store card with the $2,000 balance first. Once you pay it off, you’ll roll over the money you were paying to the credit card with a $500 balance. Chances are, though, the $2,000 store card will take a while for you to pay off. You might lose motivation in the meantime and give up your dream of being debt-free.

Slowing the Avalanche

Dave Ramsey suggests that you could transfer the higher interest-rate card to one with a lower interest rate. However, many of these balance transfer rates are introductory only and could increase over time. It may end up being higher than it was initially.

He also suggests that the avalanche method often leads to burning out because you don’t see progress as quickly. Think of it as stalling in your weight loss journey. Maybe you have a great week of eating all the protein you should, avoiding carbs, eating lots of vegetables and hitting the gym. Yet, it hasn’t moved when you step on the scale or, worse, however, has gone up. This perceived failure tempts you to throw in the towel, after all, that hard work should lead to a loss. Eventually, it will lead to a loss on the scale, but it’s those stalls and plateaus that end up discouraging us and making us want to eat a brownie while binging Netflix instead.

Which is Better?

I’m not a financial expert, so don’t take anything I say as gospel or even expect it to work for you. Just like our surgeries, snowball debt reduction will only work if you work. Meaning, to reduce your debt and eliminate this stress in your life, you have to work at it. Figure out which method or a combination of the methods works best for you. I can’t tell you what to do with your money or which way is better for you. Only you can decide that.

Having said all that, though, I recommend the debt snowball method. It’s hard to make changes. We’ve seen that with our surgeries. We’ve had to make changes to the way we eat, drink, live, exercise, sleep and a thousand other areas. However, the small changes we make add up to significant results on the scale. Just like the snowball method, the small victories add up to big success. I know my personality thrives on achieving and accomplishing goals, and if I can’t see progress, I get discouraged. Perhaps you’re the same way. Those small victories give us the most vital tool of all – hope. Hope is so powerful and can be extremely encouraging.

RELATED CONTENT: Want to learn the 10 changes you need to make in your life to be successful with bariatric surgery? Get our free download here!

My Debt Reduction

As I started on my weight loss journey, I knew that my debt was an area of my life that I’d have to tackle. It caused me so much stress, which often led to my stress eating and worrying. Between student loans, car loans and some credit cards, it was hard to see the light at the end of the tunnel. Thank God I found Rosemarie and Dave. Thanks to them and their wisdom, I created the first budget to which I was able to stick. I also started using the snowball method to tackle my debt. I’ve paid over $20,000 towards my debt since I started.

While my debt reduction journey is far from over, and I’m always trying to find new ways to pay extra on my bills, I know I’m on the right path. Money no longer stresses me out the way it did before because I know I’m doing everything I can. I also have faith in God that He will help me through whatever situation gets thrown at me. I’m doing everything I can to snowball debt, and I know there’s light at the end of the tunnel.

Here are some of my favorite ways to save money. For more information, check out my post on how to pay for weight loss surgery.

• Ibotta–Add certain items to your list, and when you buy them, you get some cashback. Use referral code hfbypfb.
• Receipt Hog–Earn points for scanning receipts, which you can redeem for Amazon Gift cards or PayPal payments.
• DOSH–Earn cash back on purchases you make every day. Use referral code NICOLEB691.
• Fetch Rewards–Earn points for scanning receipts and redeem for gift cards. Use referral code BKT17, and we’ll both get 2,000 points!
• Honey–An extension for the Chrome browser that applies all applicable discount codes and finds you the best deal when shopping online.

Surgery is Expensive

So why are we talking about debt reduction on a weight loss surgery blog? As I’ve said, I believe it’s essential to tackle the most stressful situations in your life so that they don’t sabotage you later. Money is the source of significant stress for a lot of people. I want you to be successful in your weight loss journey, so I’m giving you the tips and tricks you need to take care of yourself physically, mentally, financially and spiritually.

RELATED CONTENT: Want to learn the 10 changes you need to make in your life to be successful with bariatric surgery? Get our free download here!

Not only that, but weight loss surgery is super expensive! You may even go into some debt to have surgery. I know I did. However, when I paid off that last medical bill related to my weight loss surgery, it felt amazing. I felt like my gastric sleeve was finally mine, and it lifted a massive weight off my shoulders. It was only possible thanks to the snowball method. I’ll forever be grateful for the lessons I’ve learned on my weight loss and debt reduction journeys.

Take Control of Your Debt

As we journey through weight loss surgery, chances are we’ll face some sort of stress around money. If you’re like the average American, then I guarantee it will affect you in some way. Taking control of your debt will help eliminate stress in your life, which will reduce your chance of stress eating. By using the snowball method, you’ll be more motivated to continue paying down your debt. Eventually, you will eliminate your debt and significant stress. Remember, even the slightest sphere of snow can become a mighty snowman. You just have to start pushing.

If this article gave you some great ideas to incorporate into your life, just imagine what other amazing strategies I have for you! Share this post on social media by clicking one of the sharing buttons, and don’t forget to join my email list! You’ll be the first to get updates, access to my new products and lots of tips, inspiration and motivation to help in your bariatric surgery journey. Just for joining, I’ll send you a free Bariatric Beginner’s Guide to get you started, as well as some other pretty awesome goodies to keep you motivated. Join today!

In Summary

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