When most people construct and start executing their debt repayment plan, they get excited. They see the giant iceberg of debt that’s been blocking up the straits of their life slowly starting to melt and they want to see it melt faster.
Snowflaking is a simple way to make that iceberg melt a little quicker.
What is snowflaking? It’s a term derived from “debt snowball,” which is Dave Ramsey’s term for his specific implementation of a debt repayment plan. Snowflaking means finding little “flakes” to add to your “debt snowball.”
It’s easier to show this by example.
Let’s say you’re walking along the sidewalk and you spy a $5 bill laying there. You put it in your pocket, don’t spend it, and then add $5 extra to your big debt payment at the end of the month. That $5 is a snowflake.
Let’s say you’ve decided to allow yourself two stops at the coffee shop a week on your way to work. One week, you choose to stop only once, and that saves you $7. Add that $7 to your big debt payment and you have yourself another snowflake.
Let’s say you decide to not buy your usual twelve pack of soda at the store and instead focus on drinking more water this week. You’re not giving up soda, but just looking for a little way to cut back. You take the $5 you saved and add it to the debt payment – another snowflake.
Let’s say that instead of your regular Thursday evening where you go out with your spouse, you stay home and prepare a special meal for the two of you, saving $20. You put that $20 toward your monthly debt payment – another snowflake.
Snowflakes can pop up in almost any aspect of our life, from food to romance, from entertainment to energy use. They’re easy to find if you look for them.
Does it really help, though? Let’s say you use snowflaking to tackle a $200,000 mortgage (thirty year 5% fixed). You have just enough to make the minimum payments, but you manage to snowflake an average of $50 a month as an extra payment. You’d pay off your debt two years and ten months earlier just because of the little savings you discovered here and there along the way.
The impact is even bigger on a smaller debt, where you can sometimes halve the repayment time just with these little moves.
Add snowflaking to your debt repayment repertoire. You’ll be glad you did.
This post is part of a yearlong series called “365 Ways to Live Cheap (Revisited),” in which I’m revisiting the entries from my book “365 Ways to Live Cheap,” which is available at Amazon and at bookstores everywhere. Images courtesy of Brittany Lynne Photography, the proprietor of which is my “photography intern” for this project.