Debt Snowball vs Debt Avalanche: Which Should You Use?
Both methods start the same way
List every debt with its balance, APR and minimum payment. Decide on one monthly amount you can put toward debt and keep it steady.
Each month you pay every minimum. Everything left over goes to one target debt. When the target is paid off, its minimum joins the extra money and moves to the next target. That rolling payment is what makes both methods work.
Snowball: smallest balance first
The snowball targets the debt with the smallest balance, regardless of rate. You clear your first debt sooner, which many people find motivating.
Avalanche: highest APR first
The avalanche targets the highest interest rate first. With the same monthly budget it never costs more interest than the snowball, and often costs less. The gap depends on how different your rates and balances are.
How to choose
Run your own numbers. If the avalanche only saves a small amount, the order that keeps you going is the better plan. If it saves a lot, it may be worth waiting a little longer for that first win.
Try the Snowball vs Avalanche Calculator
Educational information, not financial advice. Check your card or loan agreement for your exact terms.