An average household in the US with a credit card debt is reported to owe at least $16,061. Thus, you are not the only one struggling to pay off debts. To attain financial freedom, you need to create a snowball spreadsheet. If you have never made a snowball spreadsheet before, don’t worry; this article highlights everything you need to know.

How Does Debt Snowball Spreadsheet Work?

The debt snowball spreadsheet is not something too complicated to understand. It is a tool that breaks down debts into a simple payment plan.

To commence creating the spreadsheet, you should know the amount of money you could use to pay off your debt without feeling burdened. Remember, the higher the amount you pay now, the less you will need to pay in the future. Determine the amount of cash you save to settle debts that are way more than your minimum monthly payments.

Once you have done that, you want to key in all your debts, starting from the smallest to the largest. Be sure to include every detail, such as rates and the minimum monthly payment for the debts.

The spreadsheet should automatically reveal the duration it would take to settle your debts as long as you focus on one account at a time. After you know the period it would take to pay off the current debts and become debt-free, take a step further and determine how best you can accelerate the process.

What Are The Steps Involved in Creating a Debt Snowball Spreadsheet?

Step 1: Confirm Your Debts and Interest Rates

The first step involves looking at your individual debts and the interest rates. This helps you know the total amount you are expected to pay. After you have had this information written down accurately, you are ready to move on to the next step of creating the spreadsheet.

Step 2: Put Everything into the Spreadsheet

You can complete this process using Google Sheets or Excel. Whichever system you choose, you will always get the same result. In this case, we are going to use Google Sheets to complete the process.

You need to key in the name of the loan and the interest rates involved. Albeit the interest rates will be used later, you need to have it close. When doing this, you want to leave some space between the debts where you will enter the minimum amounts you can pay for each loan.

The next step involves entering the amount you owe for each loan and then keying in the minimum monthly payment in the third row.

You will see a tiny blue box at the bottom right corner of the cell. You need to click and drag the blue box down to duplicate your minimum payments. When you do this, you will see that each cell’s minimum payment amounts are accurately repeated.

To have the numbers reflect dollars, be sure to change the cell formatting to the correct currency. This can be done by highlighting each cell with the numbers in them, which is the dollar sign located in the toolbar.

Step 3: Factor in Dates in the Columns

To ensure that your spreadsheet makes sense, you need to track down your progress. This will also help you realize how soon you can clear the debts and achieve financial freedom. Commence with the month you are in and move forward.

In cell A3, you will need to enter the month and the year. For instance, if you are doing this in March, you will enter something like March 18. Below it, April 16, May 18, etc. It is vital to keep this going for five years’ worth of months. Though this might seem tedious, it will help you maintain a good record of your debt repayment plan.

Step 4: Calculate the Much You Pay With Each Payment

Now, it is time to get a little complex and deal with some calculations here and there. If you have never applied any formulas to spreadsheet, this is going to be a fascinating experience for you. In this step, you will apply a formula that helps you determine the interest rates you will pay for each loan.

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

Consider the total amount you owe for a given loan, then multiply it with the interest rate, divide that by 12, and you will get your monthly interest rate.


The debt snowball plan provides you with the necessary tools to forecast your loan repayments and savings. This explains why according to most experts, it offers the best way to pay off debts and get rid of long-term debts.

Since you won’t be struggling to pay off the debts, you will still be able to repay the loans without making critical changes to your lifestyle. Note that the process takes time, so you need to be very patient with yourself. The pointers shared above should help you create a good debt snowball spreadsheet without breaking a sweat.