Debt-Free Both methods work the same way: pay the minimum on everything, and throw every extra dollar at one debt. The only difference is which one.
- Snowball: smallest balance first. You see a debt disappear fast, so you stay motivated.
- Avalanche: highest interest rate first. Mathematically, it saves the most money.
Example 1: three common debts
Credit card $3,000 at 24.99%, car loan $8,000 at 4.9%, student loan $12,000 at 5.5%. Paying $700 a month in total.
| Snowball | Avalanche | |
|---|---|---|
| Debt-free in | 37 months | 37 months |
| Total interest | $2,263 | $2,241 |
Difference: $22. Here the smallest debt also has the highest rate, so both methods start the same way.
Example 2: five debts, mixed rates
Amex $4,200 (27.9%), Visa $1,500 (22.4%), car $14,500 (6.9%), student loan $21,000 (5.5%), medical bill $900 (0%). Paying $1,200 a month.
| Snowball | Avalanche | |
|---|---|---|
| Debt-free in | 40 months | 40 months |
| Total interest | $5,224 | $4,960 |
| First debt gone | Month 3 | Month 11 |
Avalanche saves $264. Snowball gives you your first win 8 months sooner.
So which one?
If you've tried before and quit, pick snowball. The early wins keep you going, and the cost is usually small. If you're disciplined and want every dollar, pick avalanche. The worst choice is not picking either.
Want your own debt-free date?
Type in your debts. Get your exact month, which debt to pay first, and how much interest you'll save.
See my debt-free date →Educational content, not financial advice. Examples use the numbers stated; your results depend on your own debts and payments.