Debt snowball vs. avalanche: which payoff plan fits you
Two proven ways to pay off several debts. One saves the most interest; the other builds momentum.
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If you have more than one debt, pay the minimum on all of them and put every extra dollar toward one target. The two popular methods differ only in which debt you target first.
Avalanche: highest interest rate first
You attack the debt with the highest APR. Mathematically this saves the most money in interest, especially when a credit card charges 20% or more.
Snowball: smallest balance first
You attack the smallest balance regardless of rate. You pay off a debt quickly, and that early win keeps many people motivated. The cost is usually a bit more interest.
Which should you pick?
If you are disciplined and motivated by numbers, choose avalanche. If you have tried before and lost steam, choose snowball. Either one beats making only minimum payments.
If debt feels unmanageable, a nonprofit credit counseling agency can review your options, often for free or at low cost.
Find money for extra payments
Record minimum payments as needs in the planner, then see how much is left for extra debt payments.
Find money for extra payments →General educational information, not personal financial advice.