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[Updated July 2021]

I was sitting at my computer looking at my dwindling bank account. Every month my balance dropped a little closer to zero, increasing my nerves and anxiety.

I pulled up my student loan websites one by one to add up all of my minimum payments. I felt hopeless when I added up how much money I needed to pay back. It was over $45,000.

I needed a miracle. Or at least a plan.

I went to my good friend Google for answers and found the tools to climb out of this giant hole I dug for myself.

When my wife and I started dating, we had mountains of debt. I carried around my giant weight of student loans, but that’s not the whole story. Both of us had credit card debt, car payments, and Jenna also had $45,000 of student loans. We were a match made in heaven, except we were miserably overwhelmed by debt.

Our total debt was $100,000 – and we were making less than $45,000 a year combined. 

We felt suffocated and stifled and afraid that debt would steal our dreams of getting married and starting a family. Kids and daycare are expensive, and we didn’t want to bring a child into the world to be crushed by debt from day one.

We also couldn’t afford daycare and student loans. 

Our budget would easily be $500 in the red every month. I wanted those suckers paid off as soon as possible!

After a few hours searching on Google I found the weapons to slay our debt dragons. 

First, we each created a zero based budget to manage where our money was going, but we needed another plan – a plan to pay off our debt. Luckily, we stumbled upon a little miracle worker called the debt snowball.

My goal in this article is to teach you how to make a debt snowball spreadsheet. I don’t care if your debt snowball is in Google Sheets or Excel. I want to help you get out of debt, and I know a debt snowball spreadsheet is the best tool to do that.

What is a Debt Snowball Spreadsheet?

Dave Ramsey is famous for spreading the concept of the debt snowball spreadsheet. That’s where we first heard about it, and when we first started working to become debt free, we consumed everything on Dave Ramsey’s blog.

Imagine a silly cartoon of kids playing on top of a hill. The kids are goofing around, throwing snowballs at each other and building a snowman. Then one of them slips and falls down the hill. In true cartoon style, instead of just falling down and getting back up, the kid starts rolling down the hill.

At first he rolls slowly as snow forms up around him. But soon he picks up speed and turns into a rolling snowball. Before long, he’s a giant mass of snow rolling out of control down a hill, getting bigger and gaining speed every second. Nothing can stop him and he basically destroys everything in his path.

That’s how a debt snowball works. 

Except instead of a kid rolling crazy fast down a hill, your debt gets paid off faster and faster as your debt snowball rolls.

The basic principle is to pay off your smallest debt as fast as possible. (Notice I said smallest debt, not the one with the highest interest rate. I’ll explain why in a little bit.) Once it’s paid off, instead of spending the payment money someplace else in your budget, you apply it to the next lowest debt.

For example, if you pay off a student loan with a minimum balance of $50 and your next smallest loan payment is $100 you combine those payments together.

Now instead of your minimum payment being $100, you pay $150 which helps you pay off your debt faster. Then once that loan is paid off, you take the $150 and apply it to the next smallest loan. You repeat the process until you’re debt free.

How Does the Debt Snowball Work? Let’s See it in Action

Back in 2014 when we built our debt snowball spreadsheet, we had 5 student loans between the two of us. What’s mine is yours and what’s yours is mine, right? We weren’t excited to take on each other’s student loans when we got married, but we were committed to paying them off fast.

Make a debt snowball spreadsheet to get out of debt. I LOVE this walk through. It's so simple and helps me track my debt. I'm ready to be debt free.

We used our debt snowball with student loans, and it WORKED! 

Let me show you.

Our smallest loan had a balance of $1,384.92 and had a minimum payment of $100. I actually think it was a smaller payment, but we paid extra to pay it off faster. Once it was paid off, we applied the $100 to our next smallest loan making the new “minimum payment” $185.77.

When we finally got to our last student loan, we were paying $922 a month instead of our minimum payment of $220. And during the process, if we had any extra money or small windfalls, we applied the money to our student loans. So some months we paid $1,500-2,000 to make the process go faster.

If we had stuck with the minimum payments it would’ve taken us 25 years to pay off our student loans. 

Read that again 👆🏻

Instead, we used a debt snowball to get out of debt in less than four years on two teacher salaries.

To say the debt snowball is awesome is an understatement. It gave us 21 years of debt free-living and let us start our family way sooner!

Why the Debt Snowball Works to Pay Off Debt

If you’re big on math, you might be wondering why I don’t recommend paying off the highest interest debt first. Mathematically paying the loan with the highest interest rate will save you money in the long run because you’ll pay less interest. 

But paying off debt is more emotional and mental. It’s not all logic. 

If debt was about math and logic, nobody would be in debt. Money is emotional.

I will nearly always recommend paying off the smallest loan versus the loan with the highest interest rate. When you’re staring at a mountain of debt, it feels good to get a quick win. It helps build your confidence and get more excited about getting out of debt.

I mean, when we looked at our debt snowball spreadsheet for the first time, we had nearly $100K of total debt. It was so discouraging to think of how long it would take to pay it off.

But we had a plan and set to work.

We created momentum and belief when that first loan was paid in full. 

Without that success and belief, we may not have had the same attitude towards our debt. We used the momentum and paid off $73,000 of debt in less than four years (on two teacher salaries). The rest qualified for student loan forgiveness.

Also, if we trusted logic and math and paid the highest interest rate loan first, it would’ve taken us 10+ years to pay it off. Instead we paid off ALL of our loans in less than 4.

It would have been tough to maintain the mental energy and enthusiasm, not to mention, our debt snowball would have taken longer to get rolling.

How to Set Up Your Debt Snowball Spreadsheet to Get Out of Debt Fast!

It’s time to make your very own debt snowball spreadsheet! 

Are you ready!? 

It’s by far the best tool I know of for tracking and paying off your debt way ahead of schedule. Below are the steps I followed to create ours, with a few screenshots to help you out.

If you want to skip all of the steps, I created a debt snowball spreadsheet that’s ready to go with minimal set up. All you need to do is input your numbers and enter a couple formulas. It’s a free debt snowball spreadsheet download. You can grab it here.

You can also buy the Debt Free Playbook for $17, which has step by step walk through videos and strategies to get the most out of your debt snowball spreadsheet, whether you set it up in google sheets or excel.

That’s a steal 👆🏻

But if you’re a start from scratch, DIY kind of person, let’s keep going.

Step 1: Look up your individual debts and interest rates

The first step is to look up each of your debts so you know the total amount and the interest rate for each one. Find all of your logins and passwords and pull everything up on your computer. 

Once you have this information written down or pulled up on different tabs on your computer, you’re ready to start building your debt snowball spreadsheet.

Step 2: Getting it all into your debt snowball spreadsheet!

You can set up your debt snowball spreadsheet in Excel or Google Sheets. Both systems will get you the same results, it’s all a matter of preference. I love Google Sheets and will be demonstrating with that. But like I said, you can make a debt snowball for Excel too.

Download your free debt snowball spreadsheet here to get the template. I really want to make your debt snowball set up as simple as possible.

First, across the top of your debt snowball spreadsheet, enter the name of each loan and the interest rate. You’ll need the interest rate later, so keep it close and in sight. When you do this, leave a column in between each debt to enter the minimum payment for each loan. It should look something like this.

(Note: I do have more loans than are listed in this chart, but it didn’t fit on the page very well so I left a couple out in the screenshots).

Next, enter the total amount owed for each debt in the cell directly below the name of the loan.

Also, under the payment column for each, enter the minimum monthly payment in row three. 

In the bottom right corner of the cell there will be a small blue box. To duplicate the minimum payment for each cell in this column, click that blue box and drag down.

It will put the same minimum payment amount in each cell. Drag down as far as you think you need to.

In order to have your numbers reflect dollars, you will probably need to change the formatting of the cells to currency. To do this, highlight each cell with a number in it, the dollar sign in the toolbar.

If yours looks like this, you’re on track.

A debt snowball spreadsheet is the best tool to pay off your debt. My family used a debt snowball spreadsheet to pay off $73,000 of student loans in 4 years

Once you have all of your debts lined up, the reality of how much debt you have might feel overwhelming. I know it did for me. I knew roughly how much debt I had, but to see it all laid out plainly so I could add it up quickly, felt really daunting.

But it’s part of the process. 

If you’re making a debt snowball spreadsheet right now, then you’re better off than most people in debt because YOU’RE DOING SOMETHING ABOUT IT! 

I’m proud of you for choosing a debt free future and putting in the work now to experience freedom in a few years.

Step 3: Add Dates in Column A

Tracking your progress is huge for your debt snowball spreadsheet. It also helps you plan how fast you can be debt free. 

Starting with whatever month it is, enter the name of the month and the year in cell A3. For example, if you are starting today, enter December 18. Below that, January 19, February 19, etc.

It’s a safe bet to keep going for about 5 years worth of months. This is tedious and time consuming. I found it annoying because the formatting kept changing. Tinker with it until you find a format you like.

And if you want to make MULTIPLE payments each month, create two rows for each month with the amount you plan to make for each payment. Making multiple payments each month is a great idea because you’ll save money on interest and it will help you pay off your debt faster.

A debt snowball spreadsheet is the best tool to pay off your debt. My family used a debt snowball spreadsheet to pay off $73,000 of student loans in 4 years

Step 4: Calculate how much you actually pay off with each payment.

Up to this point we haven’t needed any formulas to help us make calculations. But it’s time to get fancy! If you’ve never used formulas in a spreadsheet, it’s pretty much the coolest thing ever.

The only formula you need calculates the approximate interest you’ll pay with each payment. The formula for this is pretty simple.

(Total Amount Owed X Interest Rate) / 12 = Monthly Interest You Pay

Take the total amount owed for the loan and multiply it by the interest rate. Once you have done that, divide by twelve to get the monthly interest.

Let’s calculate my Firstmark loan together. The total amount owed is $1,384.92 as listed in cell C2. If I multiply that by the interest rate of 3.3% (multiply by .033) it equals 45.70 after rounding. Then to get the monthly interest, I divide that by 12 to get an average monthly interest payment of $3.81 (again after rounding).

(1,384.92 X .033) / 12 = 3.81

This is approximately how much of my payment is going toward interest every month. Now you’re ready to create your formula!

Click in cell C3 and enter the following formula.

=(C2-B3)+monthly interest rate

For my Firstmark loan, I enter “=(C2-B3)+3.81.” If you’ve done this correctly, it will automatically calculate the new remaining balance on your loan.

The beauty of this is that if you need to change your monthly payment, or have extra money that month, all you do is type the amount of money you’re putting toward the loan in the “minimum payment” box, and it will automatically update your repayment for the rest of your cells.

It’s amazing and makes it so easy to adjust and update your debt free date.

See How Long It’ll Take to Pay Your Smallest Debt in Full

Now, to duplicate this formula throughout the rest of the C column, click on the cell C3.

The bottom right hand corner will have a small blue box, just like I explained above.

If you click and drag that box down the column, it copies the formula into each box that you highlight, automatically updating the progress of conquering your debt.

Drag this box down until the remaining balance becomes zero or negative.

Now look over at the date in Column A. If you make the minimum payment every month, that’s the month you can expect to pay off that loan. If you want to pay it off faster, find ways to increase your minimum payment.

Use the same drag down method on the payment columns to duplicate the minimum payment each month.

Repeat the process for each of your loans and debts using the appropriate cell numbers. When finished, it will look something like this.

A debt snowball spreadsheet is the best tool to pay off your debt. My family used a debt snowball spreadsheet to pay off $73,000 of student loans in 4 years

Step 5: Calculate the Debt Snowball in Action

The best part about creating a debt snowball spreadsheet in Excel or Google Sheets is it allows you to easily use the concept of the debt snowball vs writing down your debts on paper.

The magic begins when you pay off one of your debts.

As you can see in the example above, by maintaining a minimum monthly payment of $100 a month, the Firstmark loan on the left is paid off officially in October 2017.

This is assuming that I only pay the minimum balance each month.

Side note: I highly, highly, highly recommend paying more than the minimum balance if you can.

I’m a big fan of paying MORE than the minimum on your debts. Scrape up every spare penny you can manage and put it towards your lowest loan balance to make this process go faster. 

If you need inspiration to save money, you can find it here.

Now that one loan is paid off, I simply apply the $100 I was paying on that loan to the loan with the next lowest remaining balance, the Campus Partners loan making my new payment $185.77.

The extra $100 helped me pay off this loan so much faster. It’s also easy to update my formula to see my new pay off date. If I click on the cell for November 17 of my Campus Partners loan, the formula will show up in the formula bar indicating “=(E17-F18)+25.32.”

The only change I need to make is to change the 85.77 to 185.77 in the “payment” column, and then drag down the payment column with my new minimum payment until the loan is paid off.

It should automatically recalculate your payoff date and if you’re like me, you’ll be amazed at how much sooner you can pay it off using the debt snowball spreadsheet.

Extra Payments Make Your Debt Disappear Fast

As I played around with this I was amazed at the difference this extra $100 dollars made on the time table needed to pay off the loan.

If I only paid the minimum balance of $85.77, it would take nearly seven years to pay it off completely.

However, by adding the extra $100, I could pay it off in only a little over two years!!!

Read that again 👆🏻 It’s powerful.

That is five years of payments I don’t have to make! HOLY COW!!!

Every time you pay off a loan, add the amount you were paying towards your next lowest debt and the debt snowball works to pay off your debt faster and faster! Now repeat the process for the rest of your debts.

Jenna and I went from 30 years of paying off loans to five after creating our debt snowball spreadsheet and using the debt snowball method.

That is a difference of 25 years!!!

A small disclaimer, we did make other choices in our lifestyle – living on a budget and working extra jobs – to help us pay more than the minimum balance on our lowest loan, but this concept has truly transformed our ability to pay off debt incredibly fast!

You can play around with your debt snowball spreadsheet to see which order will get you debt free the fastest. For us, it was the smallest balance loan and leaving the highest interest rate loan for last. Find the order that is the fastest for you.

Debt Snowball vs Debt Avalanche

There’s a lot of debate over which debt free strategy works better – the debt snowball or debt avalanche. 

Here’s what you need to know about the differences and which will work better for you.

When is the Debt Snowball Best for Paying Off Debt

This is my recommendation for most situations because you pay off the smallest debt first, which creates momentum and belief in your system.

Feeling successful in the first few months of paying off debt helps you keep going, and that’s important. 

The debt snowball method works best when all of your interest rates are fairly similar. We used our debt snowball for student loans, which all had interest rates between 3-7%.

After crunching the numbers and setting up a debt snowball spreadsheet to pay off our debts in different orders, I found it fastest to start with the smallest debt first. 

When to use the Debt Avalanche to Pay Off Debt

The debt avalanche uses math and advocates to pay off the debt with the highest interest rate first. 

The goal is to save money on interest over the course of getting out of debt. The debt avalanche works best when you have one or two high interest debts, like credit card debt. By attacking the debt with the highest interest rate, you’ll pay it off faster and save hundreds, if not thousands on interest.

Which is better for you? Debt Snowball or Debt Avalanche?

Only you can answer that question, but you can use the debt snowball spreadsheet I describe in this article to help you out. This is also a part of the Debt Free Playbook mentioned below. Here’s how to figure out which method is better for you.

When you set up your debt snowball spreadsheet, set it up as a debt avalanche AND as a debt snowball.

Include all of your loans in each spreadsheet and see which one gets you out of debt faster. Then use that debt spreadsheet and don’t look back.

Honestly, the debt snowball and debt avalanche both work. The most important thing is to set your spreadsheet up as soon as possible.

Debt Snowball vs Debt Avalanche Table

Try the Debt Free Playbook

If you made it this far, you probably have everything you need to get out of debt fast with your debt snowball spreadsheet (or debt avalanche).

But, one thing I’ve noticed about a lot of debt free tools and guides is that it’s missing an actual GUIDE to show you how to become debt free.

That’s where the Debt Free Playbook comes in handy.

I don’t want you to have to get out of debt by yourself, and I certainly don’t want you to feel super frustrated working with your debt snowball spreadsheet. If you’re feeling frustrated, alone, and just weighed down by your debt, the Debt Free Playbook is probably for you.

You’ll get a guided video of me creating a debt snowball spreadsheet with you. You can watch as I enter formulas, minimum payments, and format the spreadsheet to find your debt free date.

PLUS….there are bonus videos, because bonuses are fun.

The bonus videos help you with things like:

The goal is to help you get out of debt as fast as possible, and the Debt Free Playbook can help you do that. It’s the closest thing I have right now to live coaching. Go check out more details – just click here.

Debt Free Playbook Image

What to do Next?

If you’re ready to make a debt snowball spreadsheet, get your free download here. Or buy the Debt Free Playbook for $17. Both of these will make it easier to set up your debt snowball in Excel or Google Sheets.

Still on the fence about the debt snowball method? Check out this article on “Why the Debt Snowball Method Works“.

Our budget and goals changed our lives and it can change yours too. Grab your step by step guide to make your debt snowball spreadsheet today!

Debt Snowball Spreadsheet: How to Make One TodayDebt Snowball Spreadsheet: How to Make One Today

26 Responses

  1. This is killer and a must for anyone who has multiple loans they are paying off. We had tons of spreadsheets like this for our debt payoff so I recommend for people to make this for their loans. Great explanation on how to make it and a great post overall! Really enjoyed this post but I guess I am a spreadsheet nerd….

  2. Jamie, thank you for this post – it was just what I need to help get myself set up to pay off my debt. I have been looking for more than 2 hours to find a “how to” instead of a “download” on setting up a debt snowball spreadsheet. Then, I found your article – such a blessing! I was able to set up my information in less than 30 minutes and see my financial situation. Thank you so much for your article as it has lifted my hope up – even if the numbers were a bit daunting!

    1. You’re welcome! I’m so glad you were able to get your debt snowball set up! Keep putting in the work and your debt will start to disappear. You’ve got this!

      1. OMG! I’ve never even wanted to learn spreadsheet formulas but I want out of this mess FAST!! Thank you SO much!!!

        1. Yes! You’re welcome! I’m glad it’s helpful and I found another spreadsheet convert. ? if you need help setting it up, let me know!

  3. Pingback: Debt Snowball |
  4. I am in no way an excel pro, but I was trying to figure out a way I could account for changing minimum payments each month (say I’m able to scrounge an extra $100 one month and only $50 the next). I changed the formula to read =(C2-B3) +interest. That way I can change the monthly payment without editing the formula. Do you forsee any problems with this method?

    1. Also, thank you so much for the tutorial! This helps put things into perspective and really motivates me to try to pay it off faster. It’s a challenge now to beat the payoff date!

      1. You’re welcome. I love to hear this! I always found it motivating to try and beat the payoff date too!

        Remember to celebrate every win along the way! Let’s get debt free!

    2. Awesome! I actually found your way to be an easier way to do it. I changed the directions on the downloadable debt snowball spreadsheet, but forgot to change it in the article. ??‍♂️

      You’ll have a much easier time adjusting your payments when you have extra money!

  5. I found your article to be very helpful! I just created my spreadsheet and it’s pretty scary!! I just have one issue, maybe I did it wrong, in the formula to calculate the new balance it doesn’t seem to reflect that the monthly interest will be lower as the balance gets lower. Did I miss that part?

    1. I’m glad it helped you set yours up Sara!

      You didn’t miss anything. This spreadsheet doesn’t factor in a lowering interest rate as you pay down your debt.

      I’m sure you can create a formula to do that. This one is designed to give you a close picture of when you. Can get debt free. The good news is that your debt payoff date will be sooner than this spreadsheet calculates because this one assumes a higher interest rate for the entire duration of your debt.

  6. I love Dave Ramsey’s thinking process and it makes sense to me. Getting my husband on board to even consider reducing debt is an issue (because he’s not into giving up something he loves.)
    How do I get him on board?

    1. Getting your partner on board can be tricky, and there isn’t really a one size fits all. There’s definitely a balance to budgeting, and if you never spend money on things you love, it makes it harder to keep focused on reducing debt.

      A good place to start is being direct and specific about WHY you want to get out of debt. What are your big life goals you’re both working on together? And when do you want to accomplish them? When you’re on the same page about goals, it’s easier to see debt as the obstacle and common enemy.

      For us, our goal was to start a family which we knew meant daycare. We knew that we couldn’t do daycare and debt. It created a sense of purpose and common enemy.

      Then we evaluated the things we live to see what could be fit into our budget.

      I hope that helps. Getting a partner on board can be difficult and take time. Good luck!??

  7. I’m not sure how to change the interest. I saw a comment saying =(C2-B3)+interest. It didn’t work right on mine. Is it written out like this, =(C2-B3)+3.81% or =(C2-B3)+.0381%? Nothing seems to work. Thanks

    1. Hi Valerie! Great question. To get the formula to work properly you have to calculate the approximate interest per month.

      To do that – multiply your total loan amount by the interest rate .0381. Then divide the result by 12.

      That’s the number you add onto the end of the formula so it should look like this =(C2-B3)+the number you calculated.

      Let me know if that works!

      1. So, that’s what I did initially. But the same number will repeat itself every month unless I do that formula each month which seems tedious. I was hoping for an easier way. Example from above, the interest on your formula is 3.81. So every month the formula will be =(C2-B3)+3.81. The next month it should be less than 3.81 because the balance has changed. So unless I do the new formula each month, it won’t change. I’m just lazy and don’t want to redo the formula each month…LOL!! If I had a couple bills, it would be fine but I have A LOT!!!! Ughhhh.. If I have to change it each month, I will!! Thanks for this tutorial. I never would have even gotten this far without it!!

        1. Hi Valerie! It’s definitely not perfect, but the way I look at it is every month the interest added back will be a little higher than it should be since your overall balance is decreasing. This just means that your loan will be paid off quicker than the spreadsheet shows, which is always a fun surprise! If you want to go in and adjust it for every single month, you certainly can, but it might be more hassle than it’s worth in the long run. For me, it wasn’t worth it to go back in because I was okay with a general idea. I’m so glad the tutorial is working and you’re making a plan for your debt! It’s a less overwhelming with a plan of attack! I’m here if you have any questions about the spreadsheet or paying off debt and budgeting in general. If you can’t tell, I like to talk about this stuff 🙂

  8. Hi Jamie. Thank you for providing this information. I’m wondering if you can help me with creating the spreadsheet for my student load debt where the interest compounds daily…YIKES. I’m so overwhelmed by this debt but I’m committed to paying it off. I hate student loans!

    1. Hi Elizabeth! Student loans are the worst! I don’t know how to create a spreadsheet that accounts for daily compounding interest, BUT…I did find a free download on the internet that I’ll share with you and make a quick video on how to use it. It’s pretty dang slick! I’m on Instagram fairly often, so if you head over there and follow me, I can send you a message pretty easily. If you’re not on IG, send me an email and I can talk with you there!

  9. you for providing this information. I’m wondering if you can help me with creating the spreadsheet for my student load debt where the interest compounds daily…YIKES. I’m so overwhelmed by this debt but I’m committed to paying it off. I hate student loans!

    1. In the instructions, one of the steps is to take your total loan amount and multiply it by the interest rate, then divide by 12 to get your monthly interest. Instead of dividing by 12, divide by 365 to find out the daily compounded interest. It won’t be perfect but it will be more accurate than the monthly I believe.

  10. Thanks for laying out an easy to understand explanation for this! I made a couple of adjustments to appropriately represent the amount of interest towards the balance of the debt which in turn, removes a step and makes it a little more efficient. To your example of your first Firstmark loan, instead of figuring out the monthly interest and putting that static number at the end of your formula, combine your two formulas and let the spreadsheet do what it does best so you will have a more accurate remaining balance and, more importantly, PAYOFF. So instead of =(C2-B3)+3.81, do =(C2-B3)+(C2*.033/12). Take that formula and copy/paste on down until you get close to zero. In your final payment cell for that debt (should be B16), the formula should read =C15+(C15*.033/12) and your final payment should be $13.94. Congratulations, you paid off a debt a month earlier that you initially thought! There are some other, more complicated things I threw in my snowball spreadsheet just because, but this will get you closer to your actual payoff, especially depending on the number of debts you have. Hope this helps!

    1. Hey Andrew! That looks like it would definitely work in the debt snowball spreadsheet, and make it more accurate as you go along! Thanks for sharing that!

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