Debt snowball vs. debt avalanche

Debt snowball pays off the smallest balance first, and debt avalanche pays off the highest interest rate first. Both make the minimum payment on every other debt.

Updated September 2026

Snowball

Smallest balance first

Extra money goes to the smallest balance. When that debt is paid off, its payment moves to the next smallest one.

In the example: 30 months, $1,618.61 interest

Avalanche

Highest interest first

Extra money goes to the debt with the highest interest rate. When that debt is paid off, its payment moves to the next highest rate.

In the example: 29 months, $1,427.12 interest

Source Consumer Financial Protection Bureau, How to reduce your debt

Worked example

Three debts. Both methods pay $150 a month on top of the minimum payments.

The three debts
Debt	Balance	Monthly payment
Credit card 24.99% APR	$3,250	$95
Car loan 6.5% APR	$8,400	$210
Medical bill 0% APR	$640	$25

Months and interest
Method	Months	Estimated interest
Regular payments only	61	$3,587.67
Avalanche (highest interest first)	29	$1,427.12
Snowball (smallest balance first)	30	$1,618.61

The regular-payments baseline keeps each debt’s own monthly payment, with no extra payment or transfer of freed payments. Both payoff strategies add $150 per month and transfer freed regular payments from the following month. Unused final-payment money is not reallocated in the same month.

Compare your own debts

Which one to choose

Avalanche usually costs less interest. In the example it saves $191.49.
Snowball clears your smallest debt first, which helps some people keep going.
If your smallest debt also has the highest rate, both methods give the same order.
Both use the same monthly amount. Pick the order you will stick to.

Questions

All questions

What is the debt snowball method?

The debt snowball method pays the minimum on every debt and puts extra money on the smallest balance first. When that debt is paid off, its payment moves to the next smallest balance.

What is the debt avalanche method?

The debt avalanche method pays the minimum on every debt and puts extra money on the highest interest rate first. When that debt is paid off, its payment moves to the next highest rate.

Which method saves more money?

Avalanche usually saves more interest, because the most expensive debt shrinks first. In the worked example on this page, avalanche costs $191.49 less interest than snowball.

Do I pay more each month with one of them?

No. Both methods use the same total monthly amount. Only the debt that gets the extra money is different.