That is is the size of my total Debt Snowball. It will be the size of my Snowball unit my last payment is lower then that amount. That sounds really impressive until you hear that my current Debt Pool is $54,165.19!
We have paid off 6 debts so far with the snowball:
- Dentist Bill #1 - $147
- Kohl's CC - $204
- Dentist Bill #2 - $290
- Providian CC - $1055
- PayPal - $1220
- Braces (More teeth!) - $2380
Total - $5296.63
Now we have continued pay the minimum on other debt as well and our payment on debt #7 is now $292.99 vs. a minimum of $98.51, so we are now contributing nearly $200 more to our debt. Once we pay that off we will be paying $639.28 on our car payment, or the entire $292.99 more then the payment book price!
As we pay on time, our minimums are going down on debts 7 through 12. We interpret Dave Ramsey's concept to continue to pay the exact minimums, and take the difference and apply it to the active snowball, or in our case, $292 on the State Farm credit card. Others continue to pay the original payments and pay all of the other debts a little faster at the expense of the compounding snowball.
I have always said due what works for you, but for us it feels good to put everything (hopefully including the tax rebate) to the current #1 debt. The important thing is to leave the snowball money as snowball money. In other words don't take that and add it to your 401K or something else, as the idea is to get through Baby Step #2 (paying of non-mortgage debt) ASAP.
So the best advice I can give is that although it is winter (at least in the Northern Hemisphere) don't let your debt snowball melt...it is your key to freeing yourself from debt chains and being able to manage your money.