Debt can feel like a heavy burden, especially when you’re living paycheck to paycheck. It’s like you’re stuck in a loop, barely making the minimum payments and most of your money is going towards interest. But there’s a way out, and it’s called ‘snowflaking’.
Snowflaking is a debt repayment strategy where you use any extra money you find to make additional payments towards your debt. The idea is that small amounts, like snowflakes, can accumulate and make a big difference.
So, how does it work? You start by finding small amounts of money to put towards your debt. These small contributions might not seem like much, but with focus and discipline, they can add up to a significant amount by the end of each month.
There are two ways to find these ‘snowflakes’. One way is to save money in small ways. This could be anything from collecting loose change, growing your own vegetables to save on grocery bills, eating out less often, cutting down on daily expenses, or even renegotiating rates with your insurance provider.
The other way is to make extra money. This could be through selling unwanted items online, starting a side business, getting a part-time job, renting out a spare room, or even selling unused gift cards.
The key is to make sure that any money you save or make goes towards paying off your debt. It’s easy to be tempted to spend it on other things, but remember, the goal is to get your debt under control.
Now, it’s not always easy to stick to this method. Small amounts of money can easily get spent on other things. But there are ways to make sure your ‘snowflakes’ go towards your debt.
One way is to create a separate savings account for your debt snowflake money. This way, you’re less likely to spend it on other things. Another way is to have a ‘snowflake jar’ where you put your change and any money you’ve saved.
You could also use a rounding up app that rounds up your purchases to the nearest dollar and puts the difference in your savings. Or, you could get an accountability buddy to help you stay on track.
Another tip is to make saving money a game. Set yourself goals and try to beat them. And remember, it’s okay to treat yourself once in a while.
Once you’ve accumulated enough money, you can start paying off your debt. The idea is to make minimum monthly payments to all your lenders, and then focus your extra payments on one account.
You could choose to pay off the account with the smallest balance first, which can be more satisfying as you’ll see the balance decrease quickly. Or, you could choose to pay off the account with the highest interest rate first, which can save you more money in the long run.
Just remember to check the terms of your credit cards and loans, as some might limit the number of payments you can make in a month.
So, that’s the snowflaking method. It might seem like a slow process, but remember, every little bit helps. And before you know it, you’ll be on your way to becoming debt-free.
