Snowflakes, Snowballs, and Snowmen Pt. 3

Day 35- Snowflakes, Snowballs and Snowmen Pt. 3

Snowmen are made out of giant snowballs. You roll your snowballs together to different sizes and shapes and then you put them on top of each other to form the head, torso, and base. Deciding how you are going to take care of your debt snowballs is a lot like making a snowball, because you have do decide if your snowball will form the head, torso or base.

Lets look at it this way. I currently hold four debts. My smallest one, I will pay first-thus wiping it out.

Next month when I gather up my snowflakes and snowballs, I will put that same money I spent to wipe out that smallest debt to one of the larger remaining three.

But which debt should I put it toward? That is where I start thinking about my snowman's many parts.

Conventional wisdom says I should put it toward my largest of loans. It is accumulating the most interest and putting more money toward is is most logical. That is the head.

On the other hand, I could put it toward my debt I hold from my family. My folks were so understanding to give me the money. They are not charging me any interest and it is the smallest of the loans. Paying it off immediately would feel so good. Plus I love my folks and want to be out from under their debt. That is paying debt off with my heart-the torso.

Or, I could pay off my Earlham debt. Due to some poor planning and a whimsical May Term trip, I still owe them a good chunk of change. Paying that off immediately would feel really good! That is paying off debt with my gut-The base.

I cannot tell you which part of the snowman you should pay. But there are some snowball calculators which can tell you how much you will pay according to which snowball method you use. If I pay according to the torso or base, I only pay $80 more dollars than if I pay off the head. Is it worth it to me to spend that extra $80 for some peace of mind?

I am not sure yet. But, it is something to ponder about.