Category Archives: Sunday Morning Game Plan

Sunday Morning Game Plan: Debt Payoff



Last week, we discussed building our debt trackers. By now, you should have a track of debt, and be able to review your financial situation for the week.  With that in mind, we’re going to look at two methods for paying off debt, Snowball  and Avalanche, and their similarities and differences.  These two methods provide a foundation for debt elimination that many people use to make progress on the path to being financially independent.

First, we have the snowball method. This approach involves taking your debts, and ordering them from smallest to largest in terms of their dollar values, and paying them off in that order, rolling the payments from the completed debts into the next. The idea behind this method is that the psychological aspects of eliminating smaller debts provides people with enough gratification early on in the process that they will stick with it long enough to pay off their debts.

Alternatively, the other approach is the avalanche method, which orders debts by their interest rates. Like the snowball method, rolling the payments from completed debts into the next debt until all debts are paid off.  While this method is less likely to result in paying off some debts quicker, the advantage is that it reduces the amount of interest paid, and the amount you pay overall.

An example of this would be saying you had $1500 per month set aside for paying off three debts: Two Loans (with interest rates) of $10,000 (5%) and $10500 (7%) and a $78,000 (3.65%) mortgage. The snowball method would tell you to concentrate your additional money each month on the $10,000 loan, while the avalanche method would tell you to pay off the $10,500 loan first. The difference between the two methods would be about $129.00 saved in interest. If you’d like to try this out with more simulations, has a calculator available where you can plug in all of your debts and see how it works for your personalized situation.


Sunday Morning Game Plan


“You need a plan” is the piece of advice people get that is more easily said than done. Everybody wants to get out of debt, but the biggest problem people have is finding a place to start in the process. I’ve always been a big fan of the Getting Things Done  process, and one of the best takeaways was the idea of the weekly review.

Taking a Sunday morning to go over the bills and build a tracker to follow your progress is always a good idea. Different formats work for different people: some prefer a notebook, while others will use excel or an online service like You can even download and modify one to fit your tastes here.  It really doesn’t matter how you track your progress, just that it gets done so you can see where you came from, and where you’re going.

Getting out of debt will make you feel better. The first zero balance is always one of the sweetest in the process, because it provides a glimmer of light in the process. When you get to the second and third, you have momentum going for you, and you’ll find it’s like you have less of a load on your shoulders.  Understanding that it is a process and not an overnight change is key.

With motivation in mind,  I know a few people who keep track of how much interest that they paid in a given month, and how much they received (including anything like cash back rewards as interest), with the goal for the number to be greater each month.  For them, the game works because they are always trying to get a higher score by doing things that they can control.

Take some time to get your debt tracker built, and next week, we’ll talk about debt payoff methods in the Sunday Morning Game Plan.


Until next time,  go snack on some debt!