Debt Snowball vs. Avalanche: Which Pays Off Debt Faster? (With Real Numbers)
Both methods start the same way: list your debts, pay the minimum on all of them, and put every extra dollar toward one target. When that debt is gone, its payment rolls into the next one. The only difference is which debt you target first.
- Avalanche: highest interest rate first.
- Snowball: smallest balance first.
A worked example
Four debts, with $250 a month available on top of the minimums:
| Debt | Balance | APR | Minimum |
|---|---|---|---|
| Credit card | $6,500 | 24% | $195 |
| Car loan | $14,000 | 6.9% | $340 |
| Personal loan | $3,200 | 12% | $110 |
| Store card | $800 | 28% | $30 |
Results from the debt payoff calculator:
- Paying only the minimums: 47 months and $7,084 in interest.
- Avalanche: debt-free in 31 months, $3,628 in interest. Order: store card (month 3), credit card (19), personal loan (22), car loan (31).
- Snowball: debt-free in 31 months, $3,955 in interest. Order: store card (3), personal loan (11), credit card (22), car loan (31).
The extra $250 a month is the real hero: it cuts 16 months and about $3,450 of interest compared with paying minimums. Between the two strategies, avalanche saves about $327 here, while snowball closes the second account eight months earlier.
Which should you pick?
Avalanche always costs the least on paper. Snowball can still be the better choice if quick wins keep you going — a plan you stick to beats a perfect plan you abandon. When the difference is small, as it often is, pick the one that motivates you.
After you're debt-free
Keep paying yourself the same amount. Redirecting that total monthly payment into savings is how you go from paying interest to earning it — see what it grows into with the compound interest calculator.