What Debt Payoff Strategy Actually Works for You?

You’ve faced your debt, acknowledged the numbers, and taken a deep breath—but now what? In this episode of Financially Confident Christian, Ralph breaks down the two most popular debt payoff strategies: the debt snowball and the debt avalanche. More importantly, he helps you figure out which method actually fits the way you think and stay motivated. Because when the journey is long, it’s not just about what works on paper—it’s about what keeps you going. Tune in to discover the best way to payoff debt.

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Check out the full podcast episode here

Ralph walks you through the pros and cons of each approach and offers a simple action step to build your personalized payoff plan. Whether you need quick wins to stay encouraged or prefer long-term efficiency, this episode is packed with faith-filled guidance to help you move forward with confidence. With Scripture, mindset coaching, and prayerful reflection, you'll walk away ready to not just manage your debt, but to conquer it.

Chapters:

• 00:06 - Choosing the Right Debt Repayment Method
• 01:07 - Understanding Debt Payoff Mindsets
• 02:33 - Understanding Debt Repayment Strategies
• 04:38 - Choosing Your Debt Repayment Strategy
• 04:56 - Introduction to Personal Debt Payoff Strategies
• 06:42 - The Importance of Financial Confidence

Takeaways:

• You've tackled your debt head-on, and that's a major win; don't underestimate yourself!
• Staying motivated to pay off debt is a challenge, but manageable with the right mindset.
• Choosing the right debt payoff method is crucial; it should fit your personality and drive.
• Whether you need quick wins or long-term savings, your strategy should match your motivation.
• Debt repayment isn't just about numbers; it's a psychological game that requires discipline.
• Aligning your financial strategy with how you're wired can lead to true transformation.

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Episode Transcript

Ralph (00:00):
You've done the hard work.
You faced your debt, you saw thetruth, and you didn't run, but
now comes the next challenge.
How do you stay motivatedto actually pay it off?
Which method keeps you moving?
When the process takesmonths or even years?
Well, stick with me today.
'cause today we're unpacking notjust how to pay off debt, but how to

(00:22):
choose a method that best fits you.
Because the best planisn't the smartest plan.
It's the one that you'll stick with.
So stick around today.

(00:44):
Hey there.
Welcome back to your Daily,financially Confident Christian.
I'm Ralph, and I'm honored that you'rewalking this journey with me today.
This is the show where we tacklefaith, we tackle finances,
and we talk about freedom.
And today we're continuing our seriesdealing with the stress of money worries.
Now, yesterday we talked abouthow debt can shape our identity
and how to replace that shame.

(01:06):
With truth.
Well, today we're gonna shift gears.
Now that the fog is lifted and the numbersare clear, how do you create a realistic
plan that works for how you're wired?
Now, maybe you're standing at the bottomof your debt mountain and you're, you're
looking up at it and you're wonderingwhich direction to start climbing.

(01:26):
Do you attack that smallone first for a quick win?
Do you go after the big interestrates so you don't lose more money?
Here's what I've seen.
A lot of people pick a, a plan that thatsounds smart, but it doesn't match how
they're wired and they just give up.
See, Debt payoff isn't always about math.
It's a mindset, it's a discipline,and it's knowing your own

(01:50):
psychology in a lot of ways.
Here's the thing.
God created each of us differently.
Some of us are fueled by seeing fastresults now, others of us are motivated
by making the most efficient decisions.
Let's look at the book ofProverbs, chapter 24, verse three.
It says this, by wisdom, ahouse is built and through

(02:10):
understanding it is established.
What's that really telling us?
See, understanding yourself howyou think, how you stay motivated.
That's part of walking in wisdom,and that's why we're not just
comparing two strategies today.
What we're talking about is whichstrategy actually works for you?

(02:33):
Well, let me break it down for you.
There's really two methodsI wanna talk about today.
The first one is what I callthe debt snowball method.
And that one, you list your debtsfrom smallest to largest by balance.
You pay the minimums on everything,but you throw extra money, extra
every dollar at the smallest debtfirst, and when that's paid off,
you move on to the next smallest.
Now, you might be saying,Ralph, why does that work?

(02:54):
Well, this method is psychological.
It gives you those quick wins, it givesyou momentum, and it gives you motivation.
And if you're someone who needs to feelprogress to stay engaged in something,
this is the method for you becauseyou'll stay encouraged because you
see results and you see them fast.
Now, the other method iswhat we call the debt.

(03:15):
Avalanche method.
Now, in this method, you list yourdebts from highest to lowest By interest
rates, you pay your minimums on allof them, but you put all extra money
towards the highest interest debt first.
If you think about it, you're paying offthe one that cost you the most first.
Now, you might be saying.
Well, why does this work, Ralph?
Well, this method is very mathematical.
It saves you the most money over time.

(03:37):
And if you're someone who's a logicdriven, if you're someone who's patient
and loves efficiency, well, this isgonna be the method for you because why?
You're gonna stay motivated,because you're squeezing the
most value from your plan.
So whether you're emotionally wiredor you're logically wired, the
important thing is what Proverbs,chapter 21 verse five, reminds us.

(03:58):
The plans of the diligentlead surely to abundance.
Now, what is it saying there?
Diligence not perfection.
And planning, not guessing.
And see, when you choose a, a strategythat matches your mindset, you're far
more likely to finish the journey.
So here's your one action step for today.

(04:19):
First thing I want you to do ispull out that list of debt you made.
If you haven't made one, it's a great timeto do it and review all your balances.
And your interest rates.
The second thing you need to do is youneed to ask yourself this question, am
I someone who needs fast wins, or doI care more about long-term savings?
So you gotta come to your own decision.
Then once you choose that strategy, if youneed that momentum and that motivation.

(04:43):
I'm gonna encourage you tochoose that debt snowball method.
If you want to save the mostmoney long term, then you're gonna
choose the debt avalanche method.
So now you just wanna order yourdebts accordingly and highlight
the first one you'll tackle.
This is now your personaldebt payoff plan.
And listen, it's not just numbers.
It's a strategy that trulymatches your heart Let's pray.

(05:07):
Father God, thank you for creatingus uniquely, with different
strengths and different motivations.
And today as we choose how to approachour debt, Lord, give us wisdom not
just to pick the right plan, but theplan that fits how you've wired us.
Help us stay diligent.
Help us stay encouraged.

(05:27):
Lord, and guide us everystep we take on this path to
freedom and we trust you, Lord.
And we ask this inconfidence, in Jesus' name.
Amen.
You're not just choosing amethod, you're choosing a mindset.
And when your strategy alignswith how God wired you, that's
when transformation happens.

(05:49):
And if this helped you decide on astrategy, tell someone else about
it, share this episode with them.
And if you're just joining us,catch yesterday's episode first.
It's the foundation.
And don't forget, for the first100 listeners who visit financially
confident christian.com/master, I'mgiving away a free copy of my book.
It's called Mastering Your Finances.

(06:10):
It's short.
It's simple, but it is super powerful.
So head to financially confidentchristian.com/master and grab yours.
Now, tomorrow we're gonna talk abouthow to fuel your debt payoff, where
to find that extra money in yourbudget to speed this whole process up.
So let's go out there andbe financially confident.

(06:31):
Christians, you can do this.
I have confidence in you.
Have confidence in yourself.
I want you to stay financially savvy.
God bless you, and youhave a great day today.