Both methods pay off debt faster than minimums alone. The difference is the order. Here's how they compare.
The Debt Snowball
Order debts from smallest balance to largest. Pay minimums on all, then put every extra dollar toward the smallest balance. When it's gone, roll that payment into the next smallest.
Example: You have a $500 medical bill, a $3,000 card, and a $10,000 card. You attack the $500 bill first — it's gone in a month or two, giving you a quick win and momentum.
The Debt Avalanche
Order debts from highest APR to lowest. Pay minimums on all, then put every extra dollar toward the highest-APR debt. When it's gone, move to the next highest.
Example: You have a 24% APR card ($5,000), a 18% card ($2,000), and a 6% car loan ($8,000). You attack the 24% card first — it's the most expensive.
Which Saves More Money?
The avalanche always saves more in interest because it targets the most expensive debt first. On $20,000 in total debt with varying APRs, the avalanche can save $500–$2,000 compared to the snowball.
Which Gets More People to the Finish Line?
Studies show the snowball has a higher completion rate. Quick wins build motivation. People who start with the avalanche and don't see progress for months are more likely to quit.
The Hybrid Approach
Some people start with the snowball for the first 2–3 debts (quick wins), then switch to the avalanche once they're motivated and have more cash freed up. There's no wrong answer — the best method is the one you finish.
See the exact months-to-payoff and interest saved with your extra payment using the Debt Payoff Calculator.