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  • Writer's pictureDarius Smith

Better than Dave Ramsey's Snowball Method?

Updated: Nov 18, 2023

Pay Off Debt... FAST!

Welcome to paying off your debt fast! We will create a complete debt payoff plan which will be tracked on a Google Sheet. Once you fill in your debt info one time, the sheet will give you instructions to follow with real calculated numbers. The calculator does all the math for you. All you have to do is add the names of your debts, the minimum payments, and there's one thing I've added that makes the wealth is my worth plan better than Dave Ramsey's Snowball method. It's your monthly commitment which we will discuss further shortly.

Before getting too deep into the “How-To” part of this lesson, let's talk about why it's so important to pay off your debt. Paying off your debt is important simply because holding debt means you are paying interest. Paying interest means you borrowed money and every month you don’t pay a debt in full, you now also have to pay for time. Interest is literally you paying for the TIME you are borrowing. Time is the most expensive thing you can buy (especially from the perspective that it can’t be refunded). As far as I’m concerned time should be free and spent doing things you love with people you love. You don’t get any value out of paying interest AND in addition to the interest, you still owe the money you originally borrowed.

Debt Snowball Strategy

To pay off debt quickly, you are going to use the Debt Snowball Strategy made popular by Dave Ramsey. The way that this works is you put debts in order from least balance to greatest balance. You then plan to pay only the minimum amount on every single one of your debts except for one. The one that you don't pay the minimum on, you are going to pay the minimum plus an extra amount. Now this is where the Wealth is my Worth plan is better than Dave Ramsey's. You commit, in advance, to paying a specific amount of money towards debt every single month until you are debt free. The more you can commit to, the better! The total commitment amount is the sum of all debt minimums plus the amount you are committing to pay extra. The cool thing about this commitment is your debt, as a whole, becomes a fixed, predictable amount. Every debt that gets paid off increases the "Extra" amount which accelerates your pay down for the next debt but you don't have to pay any more, on debt as a whole, than you did the previous month.

Once the top debt is paid in full, the entire monthly payment that you were paying towards that debt will now be added to the debt on the next row which should be the debt with the new least balance owed. The rest of the spreadsheet update itself and next month you are to proceed according to the values shown.

Following the instructions on the spreadsheet will literally save most people years of debt payments! The best part is it should only take about 15 minutes to completely fill out this Debt Payoff Calculator!

How To Use The Digital Spreadsheet

1. Only modify white text! Add names of debts, balances to be paid and minimum monthly payments in order from least to greatest. DO NOT MOVE, REARRANGE OR SHUFFLE ROWS!!! If you accidentally mess up this spreadsheet its usually easiest to start over by re-downloading the spreadsheet. If you don't need all 20 rows, leave the blank fields blank and the minimum payment amounts will show as $0. DO NOT DELETE UNUSED ROWS!

2. Commit to a monthly debt pay amount. This commitment will have to obviously need to be greater than your total minimum payments. Remember, the more you commit to the faster your debt will disappear BUT keep longevity in mind. You will be paying this amount on debt every month. My suggestion is a minimum of $100 extra and a maximum of double your total minimum payments.

3. Once a debt is paid in full, change its white values to $0 (Debt Balance and Minimum Payment) or simply delete the row. Just remember to not modify green cells because the spreadsheet will automatically update itself if you follow these instructions.

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