What IS a snowflake?
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What IS a snowflake?
| Wed, 09-30-2009 - 9:13am |
Hey, I am pretty new to this board and to the whole budgeting and paying off debts and I am curious......what is snowflaking?
I am assuming that it is small amounts of money to put toward your debt, but I am not sure.


You've got the idea of what snowflaking is!
It is the snowballing concept of paying off bills but even broken down farther (i.e. snowflakes).
Becky
CL of 4th, 5th & 6th grade Scoliosis
You are correct in your understanding of snowflaking. It's a take off on the concept of a debt snowball. That's when you pay your min on all your debts and pick a target debt to focus more on.
Ie.. You have three credit cards and make min payments of $50 on each. You have an extra $25 per month to throw at your debt.
Visa is your target. You pay $75 to the visa (min+extra) and $50 the Amex and $50 the the MC.
Once the visa is paid off you have now freed up $75. So you move that onto the next target. Amex gets the $75 you used to pay to the visa plus the $50 min you are used to paying for a total payment of $125. MC still gets $50. When the Amex is paid off the $125 you used to send to Amex now gets added to the $50 you send to MC. So MC now gets a $175 payment.
Snowflakes are smaller dollar amounts that you add to your debt snowball to make it bigger. That can be found money from a sale, coupon usage or simply from cutting back or making due for an extra week. These smaller amounts get added to the snowball amount, are sent in on their own or are put into a special account or location to accumulate.
Personally I'm snowflaking amounts towards my sinking funds account right now. My goal is to get it a year ahead so that I can line item the sinking funds categories in 2010 and save up for them for the following year. It's a peace of mind thing. So those small amounts saved will really add up and help me reach my goal sooner.
stacy