I’ve Paid For This Twice Already…

Frugal living and debt reduction tips for a better financial future. This is one family’s story.

December 14th, 2007

Five Golden Rules For Snowflaking

Welcome to I’ve Paid For This Twice Already… where frugality and careful money management is helping us get out of significant debt one penny at a time. As part of the 12 Days of Christmas – Personal Finance Style project, I bring you my contribution of the golden variety. No, not five golden rings (although I admit that might be nice) but Five Golden Rules to successfully snowflake your way out of debt or into saving.

What is a snowflake, you may ask? I’m not talking about the fluffy white stuff outside right now for many of us (although I think they’re rather pretty), I’m talking about small amounts of money saved or earned that are applied directly to debt or into savings before they melt away into who knows where. If you are new to the concept, I invite you to read my snowflaking primer to learn all about how snowflaking works. Basically, any extra money that you can come up with from earning more or spending less can be a snowflake. I earn money for snowflaking from doing online contracting work, surveys, and this blog, for example, and I also try to spend as little as I can and apply the savings to pay down our debt one snowflake at a time.

Here are my Five Golden Rules for Snowflaking:

1. Snowflake early and often

This is really the overarching theme to snowflaking success. Snowflake whatever you can whenever you can. The more often you snowflake, the more it will become a habit to look for snowflakes. Identify them wherever you can and keep making those snowflake payments. The more ingrained the habit, the more you will find.

2. No amount is too small to be a snowflake

I have snowflaked as little as $1.04 and as much as $1313.74 and everything inbetween. Any amount can be a snowflake, and any amount can make a difference. Especially when you are dealing with a debt that has interest charged to it (which most are) or putting money into savings earning interest, don’t wait to get to a certain amount before applying that snowflake. Whatever the amount – snowflake it.

3. Anything can be a snowflake

Did you just save $3.40 at the grocery store using coupons? Did you just spend $5 less on shoes than you budgeted? Snowflake it. Just like any amount can be a snowflake, snowflakes can come from any source. They don’t have to be from a specific income stream or a specific budget item. Find them wherever you can.

4. Snowflake as immediately as possible

When you save or earn money to snowflake, do it immediately. Transfer it to your savings account or make an immediate payment to debt. If you can’t do it immediately, keep very careful track of the exact amounts and pay them or save them as soon as possible. Right now, I am limited to 4 electronic payments a month on my credit card, so I keep track of all my snowflakes each week and make a payment once a week from my checking account. My past credit card, I could pay as often as I wanted, so I would send an electronic payment as soon as I could get to the computer after finding a snowflake. Don’t give yourself a chance to spend the snowflake on something else.

5. Keep track of your snowflakes to use for motivation

A lot of small amounts may not seem like a whole lot if you don’t keep track of them. As well as watching your debt total shrink or your savings total rise, keep track of the snowflakes themselves. Keep a running total once a month to see how much all those small amounts add up to. You may be surprised, I sure was. It may not seem like much while you are doing it but a lot of little bits add up to one big chunk of debt demolished or savings achieved.

These five rules sum up the secrets to my snowflaking success. Since really committing to and implementing this strategy in June, I’ve paid off over $7000 to the principal on my debts, close to $5000 of that to my credit card debt alone (my snowflake target), almost as much progress as I made the 3 years before that combined. Snowflaking really works, and I hope you’ve picked up a tip or two! If you have any questions or tips of your own, please share them in the comments!

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59 Responses to “Five Golden Rules For Snowflaking”

  1. Thanks for the tips. I’m a big fan of the snowflake method. Its surprising how quickly they add up!

  2. Woot! :)

  3. I’m such a fan of your snowflaking method, I’m going to make it my new years resolution over and above my 2008 goals.

  4. I really really love the snowflaking concept. Once I get my monthly budget planned out, I plan on snowflaking a lot.

    It’s amazing how much money gets “lost.”


  5. Debt elimination is always good! thanks for sharing how you approach it.

    Best Wishes,

  6. Ok I am going to try this method. I was “snowflaking” in a way before I read this, but into a savings account for rainy days, however I now have freed up enough money to contribute to that on a weekly basis. So now that snowflake money will go toward a credit card that is charging interest. I am excited to see what effect this has over the next year! It is projected to be paid by Dec 08, I’ll see how it gets bumped up with the snowflakes….I’m so excited!

  7. Hi! I’m here because we’re discussing snowflaking over at Dave Ramsey’s Total Money Makeover discussion forums and I followed a link.

    We DR koolaid drinkers believe in the debt snowball, and the snowflaking concept is a great complement to the snowball idea. Kudos! On the DR TMMO boards, we’ve done a challenge to snowflake the rest of December and to share what we did and how much it’s yielding. I started yesterday, found three pennies on the floor in the back office workroom area where I eat my lunch. LOL

    Your site looks interesting, I’ll read more.


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