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Parent and Child Psychological Services PLLC 
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Snowballing Debt by rachel funnell, lmft

1/18/2019

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Debt is a major source of stress for most people, so figuring out a way to get out of the debt quickly is ideal. One quick way to get out of debt is to use the snowballing method. This method allows a person to start small with very focused intensity on one debt at a time until all the debt is paid off.
 
How does this method work?
In short, you’ll pay off your debts from smallest to largest. First, you will need to get organized by creating a spreadsheet or document where you can list all of your debt from smallest to largest. Then you begin to make minimum payments on every debt except the smallest one. You are going to put every extra dollar you have towards that smallest debt until it’s paid off. Once that debt is paid off you will take the money you were putting to the first debt and start to apply it to the minimum payment of the next smallest debt. This allows you to be putting more money towards the second debt while continuing to make minimum payments on the other debts. Once the second debt is paid off, you take all that money and apply it to the next debt. You continue to do this until all your debt is paid off.
 
Why does this method work?
There has been a lot of research on the snowballing debt method and it all says that it’s the most efficient and effective way to manage debt. The reason this method works so well is due to seeing results so quickly. You will begin to feel good when you start to pay off each debt and actually see a lot of progress on the debt that you’re focused on. When you start to pay off each debt, it will give you motivation to continue with this method until all your debt is gone. This motivation will also help you make wiser choices regarding what you are spending your money on. You will begin to eat out less or not buy things that you really don’t need at that moment.
 
How to make this method even more effective?
If you are looking to make this method even more effective, then create a budget for all your debt and expenses. By creating a budget, you will be able to keep track of where all your money is going and even find areas in which you could reduce spending and add the extra money to your debt. The best way to stick to your budget is to reduce the frequency of using debit or credit cards and just use cash to pay for everything. By using cash, you are more likely to pay attention to how much you are spending because it’s tangible. When we swipe a credit card or debit card we are too removed from it to make better decisions on our purchases. Take out a certain amount of cash each month that will go to all of your living expenses. Then create an envelope for each of the expenses and put the designated amount of cash in it. You will then take the money from the envelope when needed and it will help you stick to your budget. While sticking to a budget can be hard, using cash will set you up for success.
 

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    Parent and Child Psychological Services is a private practice serving children and families in the Sarasota, Florida area. The practice is owned and operated by Dr. Gibson, a Licensed Psychologist who is Board Certified in Clinical Child and Adolescent Psychology. ​

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Parent and Child Psychological Services PLLC 
info@childtherapysrq.com
941.357.4090 (Office)
727.304.3619 (Fax)                                                                                                                                                               
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Sarasota, FL 34233                                                                                                                                   
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