Debt Reduction Calculator Tutorial - Use a Debt Snowball to Pay Off Debt

Learn how to use the Debt Reduction Calculator by Vertex42 for testing strategies to get out of debt as quickly as possible. Try the Debt Snowball method (lowest balance first) or the Debt Avalanche (highest interest rate first), or customize the order to pay off your debts.

DOWNLOAD THE FREE SPREADSHEET:

0:09 Fill in the date and your debt information
0:36 Enter your total monthly budgeted debt payment
1:05 Choose a debt payoff strategy from the drop-down box
1:28 Visualize the snowball effect with a chart
1:42 Lowest Balance First (Snowball Method) - pros and cons
2:04 Highest Interest Rate First (Avalanche Method) - pros and cons
2:18 Enter a Custom Order to pay off the debts (best of both strategies)
3:30 Use the Payment Schedule worksheet for occasional extra payments
4:30 What to do if interest rates change

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[michellemorales]

I've been using this tool since 2017, and we were able to shave off 7 years of debt payments and $11k in interest!!

This is a GREAT tool!! 👍 😊

[CHUHN]

You are helping thousands achieve financial independence by becoming debt free. Hopefully they will exercise the discipline necessary to take action to reduce their debt and take that awful burden off their shoulders. Well done.

[MaghanK]

Just stumbled on this and want to say an IMMENSE THANK YOU for "doing the math" for me!!! I have used a paper version of a Debt Snowball before but could never figure out how to set it up in Excel to work. YOU HAVE SAVED THE DAY!!! (and my financial sanity)

[nc]

You're a lifesaver for many, God may be 1000 times with you guys

[phillipicohen]

So glad you shared this to help others in the spirit of teaching. I ended up paying a lot of money to an independent businessman to teach this to me about 17 years ago. In the long run, I netted a savings because this 'Snowball' method saved me more than I paid, but I had to go into further debt to pay for the solution. Even at the time, I felt taken advantage of, but if I didn't have to lay out the money up front, I not only would have been out of debt faster, it would have been less expensive.

[BreannaAttipoe]

I’m here beginning my snowball debt payoff including my house 🏠…thank you for the calculator!!!

[cheyennemoralesrivera]

Thank you to the individual who made this.... you're helping me get out of debt and save my finances... May whatever you do or do not believe in sending you all the positivity in the world. Thank you.

[charlesparell]

After listening to Dave Ramsey's audio book, I USED THIS A FEW YEARS AGO AND IT HELPED ME AND IT WORKS!! Unfortunately, I'm needing to use it again :( Not the calculators fault, but my own weaknesses. I'm back to the calculator as my wife and I KNOW this system works! Thank you for this software!!

[stephaniemitchell]

I absolutely LOVE this and have been using it for YEARS! Thank you for sharing this with us.

[jread]

Thank you! I have been looking for something like this and it turned out to be the most helpful tool for me to see my debt, my payments, and how long to pay off.

[icilahmb]

Company refunded 2 payments.... Class... thank you... trust this company as for the software... I redownloaded and finally saw what I was doing wrong... So as a customer I suggest lockinging the cells on the template that have formulas in order not to allow discourage consumers changing the cells and disabling the methods to get out of debt. No regrets... thank you....

[liraco_mx]

Thank you very much for this, it gave me a good handle on how much debt we have, how to best pay it off, and see some light at the end of the tunnel.

[lydiat]

I really needed this. Thank you very much for designing this excel template

[myhillsidegarden]

Just found this. Thank you so much for sharing it. I have such old skills with excel, that it would have taken me weeks to do something like this. Enjoy your day! Catherine

[liliana_cruz]

this has been SOOO helpful. I am so glad I found this. THANK

[minimisewithme]

This calculator is amazing! Thanks for the go through! :)

[alivealex]

Thanks for sharing this free resource with us!

[lilredrenethompson]

Love 💓 this spreadsheet I use it alot.

[robertohernandez]

Took a bit to figure out, but works great. Thank you!

[hugo_guzman]

Thank you for creating this useful tool! I have a question: how do I add more creditors to the fields without breaking the calculator? I get errors when copying the formulas.