Debt Avalanche vs. Debt Snowball: The Math
Which debt-payoff method saves the most money, and which one is easiest to stick with.
When you have multiple debts, the two best-known strategies are the avalanche and the snowball. Both work because they force a single focus, but the math differs.
Debt avalanche
Pay the minimum on everything, then throw every extra dollar at the highest-interest debt first. This method minimizes total interest paid.
Example: you owe $5,000 at 20% APR and $3,000 at 8% APR, with $500 a month to pay down debt. Avalanche pays the 20% debt first. You save more interest than if you had paid the 8% debt first.
Debt snowball
Pay the minimum on everything, then throw every extra dollar at the smallest balance first. When that balance is gone, roll its payment into the next smallest. This method wins on psychology: you see debts disappear faster.
Example: same debts, but you pay the $3,000 balance first. You get a win sooner, even though you pay a little more interest overall.
Which should you pick?
If you are motivated by numbers and can stay disciplined, avalanche is mathematically cheaper. If you need quick wins to keep going, snowball is still a strong choice — the extra interest is often the price of a plan you actually finish.
Trusted Funds publishes general information only. Nothing here is personalised financial, tax or legal advice.
