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This post offers free debt payoff printables and a step-by-step guide on two proven methods that actually work to help you pay off debt quickly and efficiently.
Paying off debt can be overwhelming and intimidating. However, it doesn't need to be. With a method, a plan, and a strategic process to follow, you'll be able to pay off your debt in no time!
Today, we'll discuss two proven methods that will help you pay off your debt in a strategic way. I've put together a step by step tutorial of both debt payoff methods so that you can decide which is best for your situation. I also include free debt payoff printables for each method.
The two debt payoff methods we'll discuss are the Snowball Method and the Avalanche Method. Both methods have been proven effective for hundreds of thousands, if not millions, of people over the years. I'll explain each one in detail and guide you through exactly what to do to put together a plan to start paying off your debt. The concepts are easy to understand and will allow you to come up with the best strategy for your current debts, life, and overall goals.
When I was over $90,000 in debt from student loans, these were the exact methods I used to get out of debt in less than two years. I know that if I can do it, you can too!
Let's dive in!
This post is all about debt payoff printables and the proven methods that help you become financially free.
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Proven Debt Payoff Methods that Work
There are two debt payoff methods in the financial community that have been proven to work extremely effectively for hundreds of thousands of people.
I explain each method below, provide free debt payoff printables for each strategy, and walk you through step-by-step of how to fill them out to start paying off your debt as quickly as possible.
One method is more strategic and one is more emotional. I'll explain below.
I also provide every printable in two different colors and styles so you have choices if you're not feeling girly! =)
Quick Money Saving Tip: If you have acquired credit card debt, try checking your subscriptions through this app that recognizes them, can remove them for you, and will negotiate the price down for you!
Debt Tracker Printable (Free)
The first page is a simple Debt Tracker Spreadsheet Download. This printable is for those that just want to track their debt payments and want to follow their own personal method.
That's perfectly fine as well! Everyone is different and if your system works for you, that's great!
This is a debt payoff printable that will simply allow you to track your payments. You can either use it on a monthly basis or keep a running log for the year. I purposely left the line at the top blank so you can write in the year, month, week or whatever you'd like!
You'll enter the date, the exact debt (credit card, student loan, etc), the amount paid, and the amount Left to Goal.
Now, let's discuss the two debt payoff methods and how to build a strategy for yourself.
Debt Strategy #1: Snowball Method
The debt snowball method has been widely used by many.
In this method, supported by Dave Ramsey, is helpful in creating a healthy mindset. (My thoughts on Dave Ramsey are for another discussion. I agree with some things and completely disagree with others, but that's a topic for another day.)
People choose this method if the quantity of debts they have is overwhelming. When I say quantity, I am referring to the number of debts (credit card 1, credit card 2, credit card 3, student loan, mortgage, etc)
In the debt snowball method, you will pay off your smallest debts first to decrease the quantity of your debt as quickly as possible.
The purpose of this is to make the quantity of debts not seem so difficult when we are eliminating them smallest to largest. This way you have less creditors to pay bills to each month and it makes debt payoff seem more achievable.
Full instructions that show exactly how to fill out the debt snowball tracker are below.
How to Fill Out the Debt Snowball Tracker
- List your debts from the largest amount to the smallest amount.
- Enter the amount owed on each debt.
- Write in the minimum monthly payment amount.
Step-by-Step Tutorial on How to Do the Debt Snowball Method
After you list your debts from largest to smallest, follow the below steps for the monthly instructions on exactly how to complete this debt payoff strategy.
- Pay the minimum amounts on every debt you have.
- If there's any leftover money at the end of the month, you will assign that additional money to the smallest amount of debt you have. The idea is to attack the easiest debt first and decrease the quantity of debts you owe as quickly as possible.
- After you pay off the smallest debt on the list, you will then take the minimum payment from that debt that you would have paid, and you will now apply it to the next debt in line every single month. By doing this, you'll be able to pay off your second smallest debt even quicker since you're applying additional money.
- Again, with any additional money, you'll also apply it to this smallest debt.
- You will continue doing this until all of your debts are fully paid off.
The debt snowball method is really effective because it holds us accountable for paying our minimum payments, but also gives us an easy strategy to follow to mentally be prepared to conquer our debts.
By eliminating the smallest ones first, we'll see a light at the end of the tunnel.
In this method, you'll have little wins to celebrate the entire way, by eliminating each debt one at a time.
Debt Strategy #2: Avalanche Method
The debt avalanche method is another very popular debt payoff method. In fact, it's my personal favorite.
This method will save you the most amount of money possible, which I'm all for.
People choose this method if they want to save the most amount of money possible, regardless of the quantity of debt they have open.
In the debt avalanche method, you will pay off your highest interest rate debts first to eliminate the debts that are costing you the most money as quickly as possible.
Personally, this makes sense to me. I don't like to waste money. In fact, I'd say it's my biggest pet peeve and I cringe at the thought of it. Therefore, paying off debt that has a high interest rate first makes logical sense to me.
This method does take discipline though. If you have many debts and the highest interest rate debt has a large sum owed, it can seem like it's taking FOREVER to actually get out of debt. Although you're saving yourself money, it's sometimes hard for people to feel like the strategy is working since they aren't seeing the quantity of their debts go down as quickly as they do in the snowball method.
However, in the long run, people will see that they save more money with this method.
Full instructions that show exactly how to fill out the debt avalanche tracker are below.
How to Fill Out the Debt Avalanche Tracker
- List your debts from the smallest interest rate to the largest interest rate.
- Enter the amount owed on each debt.
- Write in the minimum monthly payment amount.
Step-by-Step Tutorial on How to Do the Debt Avalanche Method
After you list your debts from the smallest interest rates to the largest interest rates, follow the below steps for the monthly instructions on exactly how to complete this debt payoff strategy.
- Pay the minimum amounts on every debt you have and make sure to write in the payment amount you made.
- If there's any leftover money at the end of the month, you will assign that additional money to the debt with the highest interest rate. The idea is to attack the debt that's costing you the most money in interest to effectively decrease the total amount of money you'll pay in interest.
- After you pay off the debt with the largest interest rate on the list, you will then take the minimum payment from that debt that you would have paid, and you will now apply it to the next debt in line every single month. By doing this, you'll be able to pay off your second most expensive debt even quicker since you're applying additional money.
- Again, with any additional money every month, you'll also apply it to this debt that has the largest interest rate.
- You will continue doing this until all of your debts are fully paid off.
The debt avalanche method is my favorite because it allows you to save as much money as possible. No one likes paying extra money they don't have to.
I hate paying interest so this was my favorite method I used and the one I highly recommend, if you have the discipline to stick with it.
At the end of the day, you'll want to analyze both methods to decide the best debt payoff method for you.
Debt Payoff Methods that Work
Those are the two methods I used to pay off my student loan debt quickly and efficiently. You can download all of the free debt payoff printables today and start implementing these strategies right away to begin your journey to financial freedom.
You've got this!
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