Guide
What to do when a debt is paid off: the snowball rollover
The rollover is the part of the debt snowball that makes it a snowball. When a debt is paid off, you keep paying what you were paying on it, but now to the next debt. Your budget doesn’t change, and the payment on the next debt gets bigger.
| Debt | Balance | APR | Minimum |
|---|---|---|---|
| Store card | $900 | 27% | $40/mo |
| Credit card | $3,500 | 24% | $100/mo |
| Personal loan | $6,000 | 11% | $190/mo |
Plus $150 a month on top of the minimums. Minimums held fixed, interest charged monthly at APR ÷ 12, no new charges. Figures below are the planner’s own math on these numbers, rounded to the dollar. Minimums only means paying each debt just its own minimum, nothing extra; when one is paid off, its minimum stops instead of moving to the next debt.
The same plan, with and without the rollover
- With the rollover: debt-free in 2 yr 2 mo, about $1,832 in interest.
- Same $150 extra, no rollover: 2 yr 6 mo, about $1,987 in interest. A paid-off debt’s minimum just stops.
- Minimums only: 4 yr 11 mo, about $3,998 in interest.
Both of the first two plans send the same $150 extra. The rollover is worth 4 mo and about $155 here. It costs nothing new, because it only keeps money you were already paying.
What it looks like in practice
The Store card is paid off in month 6. From the next month, its $40 minimum and the $150 extra both go to the next-smallest debt, on top of that debt’s own minimum. The total leaving your account stays $480.
Keeping the rollover going
When a debt is paid off, change the payment amount for the next debt that same day, before the money gets spent.
If the payments are automatic, update the autopay on the next debt. The payoff doesn’t move it for you.
The planner shows the new payment for each step, so the next amount is written down before you need it.
Opens the free planner with this example already typed in. Swap in your own balances, rates and minimums. No signup, no bank connection, and your numbers stay in your browser.
More guides
- Pay off an $8K credit card on $300 a month
- Debt snowball vs. avalanche
- How long to pay off $20K in debt
- Free debt snowball calculator
- A debt snowball spreadsheet alternative
- Pay off multiple credit cards
- The debt snowball on a low income
- Snowball with a car loan and student loans
- A debt snowball example, month by month