Choose the payoff strategy that fits you best
The two most common payoff strategies are Avalanche and Snowball. Avalanche focuses on the highest interest rates first. Snowball focuses on the debts that can disappear the quickest.
Avalanche
Best when the math motivates you.
Avalanche prioritizes paying off debts from the highest interest rate down to the lowest. It is a strong fit if you want to save the most money and see the most efficient path.
Snowball
Best when quick wins keep you moving.
Snowball prioritizes paying off debts by the ones that can go away the quickest. It is a strong fit if progress, momentum, and encouragement matter most to you.
| How I Feel | Strategy |
|---|---|
| I'm a numbers person. Numbers make sense to me. | Avalanche |
| I'm not a numbers person. Numbers scare me. | Snowball |
| I want to save the most money no matter what. | Avalanche |
| I want to get out of debt as fast as possible. | Avalanche |
| I'm looking for fast results. I like to see progress. | Snowball |
| I need lots of encouragement along the way. | Snowball |
Watch the payment strategy in action
ZilchWorks takes the balances, rates, and monthly payments from your debts and turns them into a realistic payoff plan using the strategy you feel best about.
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Print the worksheet and list every debt
Believe it or not, this is often the hardest part. It forces you to act. It makes you look at your debts. It requires you to acknowledge how much money you owe.
ZilchWorks cannot build the map until you gather the facts. Once you do that, the software can take over the heavy lifting.
Use the built-in worksheet:
Click File > Print Data Entry Worksheet...
- Gather each balance, interest rate, and monthly payment.
- Write everything down in one place.
- Do not try to prioritize payoff order yet.
Important: When you write down your debts, do not try to prioritize the payoff order. The software will do that for you. Just concentrate on finding your debts and getting them listed on the worksheet.
Here is what a completed worksheet looks like
This example shows the actual debts from the Sample2 file included with the software download.
Once your debts are listed, the hard part is over
You now have the raw material ZilchWorks needs to build a realistic plan. From there, the software handles the payoff order and shows exactly what to pay each month.