snowflake method of paying off debt


Are you wondering what is the snowflake method of paying off debt? I stumbled on this term on social media a while back and honestly it blew my mind a little bit, mostly because it was a method I was already using without even knowing it!

If you aren’t already using the debt snowflake method, you’ll want to incorporate it into your debt payoff plan stat. Here’s everything you need to know. 


The “debt snowflake” method is a way of paying off debt where you put any immediate savings (or extra earnings) in your budget straight towards debt, no matter how small the amount. In other words, these are payments that are not already planned into your budget, rather, they are captured during the month when unexpected savings or earnings arise. Think of these small savings/earnings as tiny snowflakes– they may seem small but over time, they can accumulate to have a deep impact on your debt. 

Think of it this way. Say you go out to eat with a friend. Your weekly budget on dining out is $25. Your meal ends up costing $12, and you don’t dine out any other time that week. Instead of spending that money elsewhere in your budget, you immediately make a debt payment to make up the difference ($13). It’s a small payment, but if you consistently do this in all areas of your budget, you are bound to score some big savings and pay off debt even faster. 

Some other examples of savings that may arise which would allow you to apply the snowflake method of debt repayment:

  • Selling stuff you no longer need online and applying the earned money towards your debt
  • Earning cash back on your regular grocery shopping with apps like Ibotta and Dosh and then making an equivalent debt payment with those earnings.
  • Sharing a meal while dining out 
  • Skipping your morning stop at the coffee shop once a week. 
  • Using Groupon to save on an oil change (or other needed car services). 

The key to the snowflake method of paying off debt is that you immediately apply the snowflake money towards your debt as it arises. Otherwise, it is really easy for that money to just disappear, especially if you aren’t keeping a tight budget and constantly zeroing out your numbers. 

What I love about the snowflake method of paying off debt is that it can be incorporated no matter what debt repayment strategy you are using. Some common ways you can pay off debt include:

The debt avalanche method – this method is where you start paying off your highest interest debt first in order down to your lowest interest debt. This method of debt repayment tends to save you the most money possible.

The debt snowflake method – this method of debt repayment is where you focus on your smallest balance debt first, in order to your highest balance of debt. The idea is that by getting a few smaller wins by paying off your small balances, it will encourage you to keep going to knock out the big balances. 

The worst debt method – this method is where you focus on your most bothersome debt first down to your least bothersome debt. An example of most bothersome debt would be if you bought an engagement ring and your fiance called off the engagement without giving the ring back when you took out a loan for the ring. That kind of debt would bother most people and it makes sense that you would want to eliminate it first to be able to move on and forget about it. 

[Want to get started paying off debt? Read How to Get Started Paying off Debt here.]

In any of these strategies, you can also incorporate the snowflake method of paying off debt since you can still find extra savings or earnings and apply them to debt in addition to the extra payments you are already budgeting for. And if you aren’t using any of the above strategies, using this method alone can still help you make some good headway on your debt. 


One thing you’ll want to be aware of if you decide to implement the snowflake method of paying off debt is whether the entity that services your loan (or credit card) charges fees for making extra payments. If they do charge fees, make sure you understand their rules for paying extra payments. You’ll want to be more judicious with your extra debt payments so you can get around this by putting your snowflake money in a separate savings account and wait to apply those micropayments as a larger payment once a month or once a quarter depending on their rules. While you are at it, you should also check to see that these payments can be applied to the principal (rather than interest). 


If you only use cash you may want to put your snowflake money in its own savings jar. Once a month or so you could go to the bank and deposit your snowflake money, then make your extra debt payment. What you’ll want to be sure of is that you don’t lose this money. It’s easy for small savings to disappear in your regular spending, so do carve out a physical separate space for it where you can’t reach for it at the store (i.e. not in your wallet). 

If you use a card, simply transfer your savings over into a debt payment or into a separate savings account to make a lump sum payment later if your lender has strict rules about extra payments (see above). 

Have you tried the snowflake method of paying off debt? What do you think of it? 

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snowflake method of paying off debt

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