On a $4,000 card at 22%, a $9,000 car loan at 7% and a $12,000 student loan at 4%, with $200 extra a month, avalanche costs $2,549 in interest and snowball $2,549. Avalanche saves $0.
The two methods
Both pay the minimum on every debt and send the extra money to one debt at a time. Avalanche targets the highest interest rate first; snowball targets the smallest balance first.
Avalanche is cheaper whenever the highest-rate debt is not the smallest. Snowball gives quicker early wins by closing small debts sooner.
The numbers
With the three debts above, avalanche finishes in 39 months and snowball in 39 months. The table compares both.
Which to pick
If the gap is small, choose the method you will keep following. If the highest-rate debt carries a rate far above the others, as the 22% card does here, avalanche saves real money. Enter your own debts in the debt payoff calculator to see your gap.
| Method | Months | Total interest | Total paid |
|---|---|---|---|
| avalanche | 39 | $2,549 | $27,549 |
| snowball | 39 | $2,549 | $27,549 |
FAQ
Is avalanche always cheaper?+
In interest, yes or equal. Snowball can be easier to stick with because small debts close sooner.
Does the order of minimum payments matter?+
Minimums are paid on every debt each month. Only the extra amount moves to the next debt when one is cleared.