Accelerate Your Financial Freedom: The Snowball Method of Debt Management for Healthcare Professionals

In recent times, the costs associated with healthcare education have skyrocketed, creating a wave of professionals who find themselves tethered to considerable debt. It comes as no surprise when one looks at the tuition fees charged by Private medical college students is upwards of ₹ ten lacks per annum, and boarding and costs are additional. The situation is aggravated by costly education loans averaging ₹ 60,000 in EMI, leading to no financial freedom. When you pit this number against the dismally low salaries at entry level ranging from ₹ 45,000 to ₹ 65,000 in government sectors and even less in private sectors, the medical professionals find themselves spiralling down the financial burden.

The situation further gets ugly as everyday financial obligations such as Credit card debts, auto loans, and home loans continue to demand attention. A recent survey showed that the average debt in rural areas was ₹ 60,000, while the average debt in urban areas was around ₹ 1,20,000. 

 Well, the good news is life is not all dismal.

There are ways and tools available to get you out of this downward spiral and help you regain your balance. One such tool for debt management is The Snowball method – derived from the snowball effect that takes place when a small snowball rolls down the slope, gathering more snow on its way become a big gigantic ball by the time it ends its journey at the base.

In the next 10 minutes, we will attempt to understand the method and how to implement it effectively to get us out of the spiral.

Understanding the Snowball Method for Financial Freedom

The Snowball Method, a strategy designed to simplify and accelerate debt reduction, can be a lifesaver for those weighed down by multiple debts. It involves prioritizing your smallest debts first and dedicating as much as possible to clear them quickly. Once a debt is paid off, the amount you contribute to it is rolled onto the next smallest debt, creating a ‘snowball’ effect that speeds up the rate of debt reduction over time.

This method is not only a financial strategy but also psychological encouragement. It’s designed to create small victories that motivate you to keep going, building momentum and confidence in your ability to eliminate debt. The principle underlying the Snowball Method is simple: financial success is as much about mindset as math. It leverages the power of small wins to propel your journey toward financial freedom.

Implementing the Snowball Method for Healthcare Professionals 

The debt snowball method is an effective strategy to accelerate debt repayment. It involves focusing your extra funds on your smallest debt first while making minimum payments on the rest. The success of this method relies on its incremental momentum, similar to a snowball rolling downhill.

To illustrate, consider the case of Dr Agarwal, a senior healthcare professional with the following debts:

• Credit Card balance of ₹ 83,000 at 24% interest p.a.

• Car Loan of ₹ 8,18,000 at 14% interest p.a.

• Home Loan of ₹ 1,25,35,000 at 7.1% interest p.a

• Student Loan of ₹ 30,50,000 at 11% interest p.a.

Dr Agarwal would start by allocating extra funds to clear his smallest debt, the ₹83,000 credit card balance. Once this is paid off, he takes the amount he was paying on this card – the minimum payment plus any extra – and adds it to the minimum payment of his next smallest debt, the auto loan. This is the “snowball” effect, where payments amass with each debt paid off, accelerating the rate at which subsequent debts are cleared. In this case, it’s doubly beneficial for Dr Agarwal to clear his smallest debts first, as they also carry the highest interest rates. This strategy allows him to reduce the total interest he pays over the lifetime of his debts.

A vital factor to remember is the role of lifestyle adjustments in making this strategy work. For healthcare professionals like Dr Agarwal, it’s crucial to adopt frugal habits and reduce expenditure. It allows them to free up more money that can be directed towards eliminating debt, accelerating the journey towards financial freedom.

Strategies to Maximize Debt Elimination 

To expedite financial freedom, healthcare professionals can employ several key strategies.

First, establishing an emergency fund is vital, especially considering that 69% of households struggle with financial insecurity. A fund equating to 3-6 months of salary can safeguard against unexpected costs. 

Second, renegotiating interest rates can significantly reduce overall debt costs. For example, extending a seven-year student loan at 11% to a twelve-year term at 7% will result in substantially lower monthly payments. Alternatively, borrowers can also renegotiate the loan terms to lower their interest burden by restructuring the debt. 

Third, consolidating debts can simplify repayment and potentially lower interest costs. A professional could bundle debts into their largest loan (in this case, a home loan), streamlining their monthly payments. 

Lastly, maintaining a strong credit score is essential. A good credit score can facilitate easier credit approvals, lower interest rates, and flexible loan terms in the future. A CIBIL score of between 750 and 900 is considered excellent, while a score of between 600-750 is considered average. The probability of getting a loan or favourable terms below 600 is considered low. 

These strategies, when Combined with the snowball method, can enhance debt elimination efforts, setting healthcare professionals on a faster path to financial freedom.

Maintaining Financial Discipline 

For effective debt management and financial freedom, financial discipline is a must. It begins with setting clear, specific financial goals. These can range from short-term targets to mid and long-term ambitions, providing a roadmap to follow.

Developing a monthly budget is another crucial step. It provides insights into spending habits and helps identify areas for reduction. Automating savings by setting up a recurring deposit into a savings account can ease the discipline required for consistent savings, making the process effortless. Researching investment strategies and understanding personal risk tolerance can also guide informed decisions that align with financial goals.

Lastly, cutting down spending is the key. There’s no universal approach, but creating a budget, seeking discounts, sticking to shopping lists, using promo codes and coupons, and tracking spending can all aid in reducing expenses, inching you closer to financial independence.


The snowball method presents a dynamic and fruitful strategy for healthcare professionals seeking to regain financial stability and break free from debt. It offers a systematic approach to debt repayment while instilling a sense of accomplishment and momentum with each cleared debt. However, it’s essential to recognize that this method is just one aspect of a comprehensive financial discipline.

Healthcare professionals should set clear financial goals, establish a budget, automate savings, reduce expenses, and explore strategic investments to enhance their financial strength and stability. Adopting this integrated approach empowers them to effectively manage their debt and pave the way for a brighter and more secure financial future. By taking charge of their finances, they can attain the financial freedom they rightfully deserve.