If you find yourself in debt, there are two repayment methods that can help you get out of trouble.

In the snowball method, you start by paying off the smallest debt. Once that debt is reduced, you move on to the next, smallest debt, and so on. It works like this:

Step 1: Rank your debts from smallest to largest, regardless of interest rate.

Step 2: Make minimum payments on all but the smallest debt.

Step 3: Pay as much as possible on your smallest debt.

Step 4: Repeat until each debt is paid in full.

Many people like this method because it allows you to win from the start, helping you gain momentum and confidence. Because it takes discipline and time to get out of debt, this might help you stick with it.

The main consideration with this method is that even if you pay off the smallest balances as quickly as possible, it doesn't take into account math – or interest rates. For example, your largest loan may have the highest interest, which accumulates and increases as you focus on smaller debts that might have relatively low interest rates.

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