2 min

Snowball or avalanche: getting out of debt

Two ways to order your debts. Both work if you stick with it.

Both start the same: pay the minimum on everything, put whatever extra you can on one debt, and when it's paid off, roll that payment into the next.

Avalanche: highest interest first. Usually the least interest overall.
Snowball: smallest balance first. You finish one fast, and that keeps you going.

Example

You have an $800 store card at 30% and a $3,000 Visa at 25%. Either way, the store card goes first: it's both the smallest and the most expensive.

The best one is the one you'll stick with. A few extra dollars a month changes your payoff date a lot.