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Snowball vs. Avalanche: Which Debt Pay-off Method Is the Best?

You’re now looking to pay off your debt. Congratulations! You must decide on which option you’ll employ. The Debt Snowball Method or the Debt Avalanche Method? We will discuss the differences between these two and offer you a way to determine which is most suitable for your needs.

Are you tired of being down in the dumps, and you’re eager to devise a plan for eliminating debt? Fantastic!

You might have heard about the debt snowball, and it’s identical yet distinct and a good partner for the debt avalanche.

The two approaches are nearly identical in that they both require the minimum amount on all your debts except for one debt that is your focus.

In case either way, you’ll pay every dollar that you can until the primary debt is settled. Once that’s accomplished, the next debt will become your new debt to focus on.

When you have paid off your debts, and your monthly minimum payment is eliminated, you will be able to make more and more to make additional payments to the debt you’re focusing on (hence that snowball metaphor).

One difference that exists between Snowball and Avalanche is the way you repay your personal loans. Certain personal finance writers claim that one is superior to the other; however, we think it’s just a matter of your personal preference (as long as your debts are decreasing!)

Debt Snowball Technique

Through the Debt Snowball technique, you can eliminate your debts, starting from the lowest balance to the highest balance, regardless of interest rates.

The reason is that most people have lots of debts that are not too big. A lot of bills are sent out every month. A lot of minimum bills to pay, and it can become excessive.

Medical bills from various locations, small amounts here and there on store credit card balances, or even money taken from relatives.

It’s all a bit overwhelming when it seems that you are owed more money everywhere you turn.

When you pay off your obligations from the smallest to the most considerable balance, you can quickly begin clearing those small bills.

In the case of your particular situation, you may even be able to eliminate a total monthly debt in an initial couple of months.

This is an exhilarating feeling. As you progress, you feel confident that you can do this. When you begin to tackle the bigger loans, like the car loan or your account on your credit cards, you’ve got the courage and confidence to make the necessary cash flow to see it through.

Debt Avalanche Technique

Using the Debt Avalanche approach, you pay off your debts starting from the highest interest rate to the lowest amount, regardless of the balance.

Mathematically, this makes the most sense. You’ll pay fewer interest costs if you take on your debts this way. The savings on interest means that your debts will be paid off faster. Isn’t the purpose of getting debt-free to get it done as quickly as you can?

You will get the most value for your buck when you first take on the most expensive interest rate. Why would you settle for a debt that doesn’t charge interest when you’re carrying a credit card debt charging 18 percent?

The secret nobody is discussing.

There are a lot of people with sincere opinions on which method is the best. A Dave Ramsey crowd that is hell focused on the debt snowball – has a cult following. The Avalanche community believes that math is the only way to rule and cannot comprehend why people don’t see the issue their way.

Here’s the trick… It isn’t that important!

The most effective method to pay your debt off is to pay minimum payments on all your debts except for one debt. Focus on one obligation, and spend every penny you can on the debt until it’s completely gone. Whatever debt you select isn’t a big deal! Do you believe me? Let’s look at the math.

They have agreed to pay $1000 per month toward the debt repayment method and all the necessary payments. Joe is looking to settle their debts by using the avalanche method and paying the highest interest first. However, Suzie prefers to utilize Debt Snowball to take care of the balance with the lowest interest first.

  • Joe’s avalanche will pay off the couple’s debt in five years and four months. Those are the costs.
  • Suzie’s snowball will pay off the couple’s debt in 5 years and 5 months. They’ll owe $9,378 in interest payments.

The difference is just one month and $985 over five years.

At present, $985 is an impressive amount of money. However, by the month, there’s only a $15.15 variation in the interest rate when you do it in the Snowball method instead of the Avalanche method. The bottom line is that it’s not something worth fighting about. I suggest you pick the debt that irritates you the most and work on it. Then, move to the next one, which is your most immense pain, and so on.


Both strategies are almost identical in the sense that you’ll be able to pay off the debt in a short time (depending on the amount of debt you’ve got).

Maintaining your motivation can be more valuable than the small amount of interest using the debt avalanche method saves approach since the most disastrous outcome is to abandon your strategy or fall into debt.


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