The #1 Way to pay off your debts = Planning

Michelle Jacobik Budgeting, Financial Wellness

I teach my clients how to pay off their debt using the Debt Snowball approach.

It’s the approach used to get through Baby Step Two of the Dave Ramsey “7 Baby Step Plan”— paying off all of your non-mortgage debt and gaining the momentum towards Financial Peace.

The Debt Snowball involves listing all of our ‘non-mortgage debts’ smallest balance to largest balance and whacking at them from top to bottom until they are gone.

This list includes past due medical bills, credit card debt, student loan debt, car loans, loans that need to be repaid to Grandma.

You get the gist.

Monthly Budget

Once we establish your monthly budget for the ‘four walls’ and once your $1000 emergency fund is in place (Baby Step One), we start to take EVERY extra dollar that is left and smack it onto the smallest debt that is on the top of the list, until it’s gone.

Once it’s gone, we work the next debt taking the extra money that is no longer going to the debt that was just paid and work our way down the list.

Some months, when there is an extra weeks paycheck or a Christmas bonus, this approach can be very effective and can result in a few or more of those smaller debt amounts being paid in one month!

Like building a snowball, using this approach, we start to build momentum and immediately can see the results building as we roll money from one thing to the next. It shows that a plan works.

For many people, they are working without a plan and that is where they fail.


I say it time and time again, if you shoot an arrow at nothing, it hits nothing every time!

When we establish a ‘methodology’ and start telling our money where to go, we can see it actually working. The positive feelings start to come and the decision to get out of debt seems possible.

If you need help establishing a written, workable plan I’m here to help! Let’s start 2017 off on the right footing, the one that leads to financial freedom and eliminates financial stress!

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About the Author

Michelle Jacobik

Expert in Money, Business & Finance #1 Best Selling Author & Speaker