Getting Ready For Zero Debt – sos099

What if I told you there is new fuel on the fire that works in favor of paying a higher interest debt over paying the smaller balance debt first? Wouldn't that be the best way to get ready for zero debt?

Paying off debt is behavioral

If paying off debt was only based on the math then we wouldn't have any problem convincing others to eliminate it in the most efficient way possible – highest interest rate debt first. The more you pay down, the less interest you will pay over time. That is why most people promote the “Debt Avalanche” process – it pays off the debt quicker.

The problem is that we humans like shiny new things, spoiling ourselves, and are starving for instant gratification. Paying off debt does none of that so we often quit before we are finished.

The Debt Snowball process

By paying the smallest balance debts first we are able to feel the “quick win” and are encouraged to keep going. Like a child doing their math homework, getting the first answer right will often give them encouragement to work on the second answer. With the debt snowball, the easier answers are the first questions on the math quiz and they become progressively more difficult down the page.

For an example on the differences between the Debt Snowball and a Debt Avalanche approach see this post: Highest Interest or Smallest Balance

Have fun with debt

ReadyForZero gives us a way to stay energized during the long drawn-out process of paying higher interest debt before knocking out the easy ones – and that is the key! If a tool can help you stay focused and encourage you to finish, then you will pay attention then you will pay less interest. It offers a fun way to play with your debts and it's free! Sign up for a free account at, import your debt information, and start paying attention to how much debt you are paying off!


Interview with Avoid These Pitfalls When Buying A Home - sos098
EPISODE 100: Inspiration from listeners and special guest Timm Etters


  • marcbrown

    Reply Reply March 5, 2013

    Hello Steve! First of all, thanks for the podcast. I liked and completely agree with your theory “Paying off debt is behavioral”. Perhaps, you have come across some people who though have acquired huge debts, getting regularly harassed by the creditors and collection agencies, are never affected by it and always take the issue lightly. At the same time, there are some who take their debts seriously and try hard to pay those off by any means possible. So though you might say it a behavioral process, I believe this varies from individual to individual.
    Marc Brown
    Financial Writer

    • Steve Stewart

      Reply Reply March 15, 2013

      Thanks Marc,

      I agree. There are some people like my wife who must have her stapler positioned perfectly between her mouse and the corner of her desk and then there is her husband (me) who is constantly asking “where is my stapler”? Everyone is different and react to things differently. I think we can all agree that motivation is a wonderful coach which is why I still believe in teaching the behavioral aspect of finance but also give them the pros and cons of both sides so they can make their own choice. There is a side benefit to doing that: If their way doesn’t work then they already have the information and support to try it my way. 🙂

  • innovatebig

    Reply Reply March 6, 2013

    Thanks for the excellent review. Please keep in touch.

  • stupidusernamebs

    Reply Reply October 3, 2013

    Site wont link to Capital One, and a couple other debts. No option to manually add data, so they truely don’t care about helping you. USAA has been stuck on refreshing for the last 5 minutes.
    Pretty pointless for me, waist of time.

    • Rod (@innovatebig)

      Reply Reply March 7, 2014

      Hi – we recently resolved a few critical linking problems, if possible give it another try and also please send any details to our talented support team: so we can track this further.


Leave A Response

* Denotes Required Field