The debt avalanche and the debt snowball are two ways to decide which debt gets your extra money first. Both pay the minimum on every debt and put everything left over on one target; they differ only in how the target is chosen. This page shows how each orders a list of debts, works through the same four debts both ways, and explains when the choice changes the result. The full plan around it (listing debts, finding extra money, getting help) is in the debt payoff plan, and the debt strategies hub lists the other guides.
How each method picks the target
Avalanche: sort the debts by interest rate, highest first. Extra money goes to the highest-rate debt until it’s gone, then to the next highest. Because each extra dollar removes the most expensive balance available, this order costs the least total interest.
Snowball: sort the debts by balance, smallest first. Extra money goes to the smallest balance until it’s gone, then to the next smallest. Whole accounts disappear sooner, which some people find easier to stick with, at the cost of carrying the expensive balances for longer.
In both, a debt’s payment doesn’t vanish when it’s paid off: it rolls into the next target, so the total going to debt each month stays the same until everything is cleared.
The same debts, both ways
A household has four debts and $1,120 a month for debt payments: the $720 of minimums plus $400 extra.
| Debt | Balance | Interest rate | Minimum payment | Avalanche order | Snowball order |
|---|---|---|---|---|---|
| Line of credit | $2,000 | 9.50% | $60 | 3rd | 1st |
| Personal loan | $5,000 | 12.99% | $170 | 2nd | 2nd |
| Credit card | $7,000 | 20.99% | $210 | 1st | 3rd |
| Car loan | $9,000 | 7.49% | $280 | 4th | 4th |
| Total | $23,000 | $720 |
Simulated month by month (interest at the annual rate รท 12 on each balance, minimums held at the amounts shown, extra money and freed-up payments going to the current target):
| Avalanche | Snowball | |
|---|---|---|
| First debt paid off | Credit card, month 13 | Line of credit, month 5 |
| Second debt paid off | Personal loan, month 18 | Personal loan, month 12 |
| Third debt paid off | Line of credit, month 19 | Credit card, month 20 |
| Debt-free | Month 23 | Month 24 |
| Total interest | About $2,705 | About $3,174 |
The avalanche saves about $469 and a month. The snowball clears its first account eight months sooner, while the credit card at 20.99% stays on the books seven months longer. Paying only the same minimums with no extra $400 would take 51 months and cost about $6,054 in interest, so either method does far more than the choice between them.
When the choice matters
The gap between the two methods depends on how far apart the interest rates are and how large the low-rate small balances are.
- The methods match when the smallest balance also has the highest rate. Then both pick the same target and the results are identical.
- The gap is small when the rates are close together, or when the small balance that the snowball puts first is small enough to clear in a few months.
- The gap is large when a big balance carries a much higher rate than the small ones, such as a large credit card balance alongside a small low-rate line of credit. The snowball then leaves the expensive balance growing for longer.
Some people use a hybrid: clear one or two very small balances first for the quick result, then switch to rate order. When two debts have nearly the same rate, paying the smaller one first costs almost nothing extra.
Promotional rates and changing rates
A balance on a promotional rate, such as a 0% balance transfer, sits at the bottom of the avalanche order only until the promotion ends. Many people note the end date and move that balance up the list before the regular rate applies. A variable-rate line of credit can also move up or down the order when rates change, so the order is worth rechecking when a rate changes.
Running the numbers on your own debts
The debt payoff calculator takes your own balances, rates and payment and shows the payoff date and interest under either method. For card balances on their own, paying off credit card debt covers card-specific tactics such as asking for a lower rate. If the minimums on the list can’t be covered at all, neither method fixes that; the debt relief options guide compares the other routes, from free non-profit help to the legal processes.