Debt Avalanche vs. Snowball: Compare Methods

Compare the priorities

Avalanche

First target: Highest APR
Main focus: Reduce expensive interest
Tradeoff: The first account may take longer to finish

Snowball

First target: Smallest balance
Main focus: Finish a smaller balance sooner
Tradeoff: Interest may cost more

One budget, two starting choices

Take a $3,000 balance at 24% APR with a $90 minimum and a $1,000 balance at 12% APR with a $30 minimum. A $300 total monthly payment leaves $180 after minimums.

Avalanche assigns $270 to the 24% account and $30 to the other. Snowball assigns $90 to the 24% account and $210 to the smaller one.

Where the $300 goes in month one

Avalanche

Reduce expensive interest

$3,000 at 24% APR$90 minimum + $180 extra$270

$1,000 at 12% APR$30 minimum$30

Snowball

Finish a smaller balance sooner

$3,000 at 24% APR$90 minimum$90

$1,000 at 12% APR$30 minimum + $180 extra$210

These are first-payment allocations, not full payoff simulations.

Compare outcomes with the same assumptions

Use the same balances, rates, total monthly payment, and treatment of new spending. Decide whether payments freed by a paid-off account stay in the debt budget. Otherwise, the comparison is also measuring different spending commitments.

When the simple rule needs more context

An introductory rate ending soon changes the rate picture. Fees and contractual minimums also matter. A two-column comparison does not replace reviewing those terms.

Questions

Does snowball guarantee I will stay motivated?: No. The order may suit your preferences, but it cannot predict whether you will maintain payments.
Can the two methods choose the same account?: Yes, when the smallest balance also has the highest APR.
Can I switch methods?: You can reconsider your priorities as balances and rates change. Recalculate from current balances.
Do I have to increase my payment?: The comparison can hold your total payment constant. It changes where the extra portion goes.