Snowball Vs Avalanche: Which is the Best Method for Paying Off Debt?

Christina's Side Hustles
by Christina's Side Hustles

There are many different reasons why people end up in credit card debt. It could be medical bills, unexpected financial obligations, or emergencies. I spent money I didn't have, so I needed to learn how to pay that debt off. I came across two ways of paying off credit card debt, the snowball vs avalanche methods.


Let's talk about the steps I took to pay off my debt.


Using the Credit Karma app to track debt

1. Add up your debt

Awareness is the first step to recovery. The first step you want to take is to figure out how much debt you have. I downloaded the Credit Karma app. It shows you all your debt, all the accounts you have open, your credit card utilization, all the minimum payments, and just a lot of useful information. 


2. Quit using credit cards

Next, I gave up using credit cards for a while because it's tough to pay off your balance if you keep adding to it. 

Debt snowball vs avalanche

3. Ways you can pay off your debt

Let's discuss the two ways you can start paying off your debt. These are well-known credit card repayment methods: the Snowball and Avalanche methods. 

How to pay off credit card debt

Snowball method

Here's how the snowball method works. You want to write down all your credit card accounts and then list the balance on each. Let's say you have three credit cards.


The first one has a balance of $500, the second one has a balance of $4,000, and the third one has a balance of $8,000. You want to start by putting most of your money towards paying off your first credit card while paying minimum amounts towards the second and the third one.


Start with paying off the smallest credit card and work your way to the largest credit card. 


Then once you pay off your smallest account, you can take all the money you would typically use to pay it and put it towards the next smallest account.


Once you finish paying off your second credit card with the money you would normally put towards paying off the first and the second, you then put that entire amount towards paying off the third credit card. It's literally like a snowball. 

The best way to pay off credit card debt

Avalanche method

The Avalanche method is a little bit different. What you would do is 

start with paying off the account with the highest interest rate first.


So let's say, in this case, you have your three credit cards. The first has an interest rate of 18%, the second one has 27%, and the third one is 22%.


In this case, you want to put most of your money towards the second credit card since it has the highest interest rate while making small payments towards the rest.


Once you're done paying it off, you use all the money you'd typically put towards that card and pay off the next card with the highest interest. You keep doing this until you pay off the rest of your credit cards. 

What's the fastest way to pay off credit card debt?

Avalanche vs. snowball

Technically the Avalanche method is the most effective and saves you the most money because you're saving a lot on interest. However, I know some people, including myself, prefer to use the Snowball method just because I think it's the most motivating one. You can see the results a lot quicker.


I would do the Snowball method if you feel you need that extra motivation. If you want to save the most money long-term, I would use the Avalanche method. 


I also want to talk about two alternative ways how you can pay off your debt. Like the Avalanche method, these two methods focus on saving you money on interest. 

Alternative ways to pay off debt

Balance transfer

The first thing to consider, which is an excellent option if you have good credit, is doing a balance transfer. If you currently have a credit card with a 22% interest, you can go ahead and open what is known as a balance transfer credit card. Many credit cards will offer you 0% interest for the first ten to 18 months to help you pay off your debt faster.


Personal loan

The second option is getting a personal loan. I've seen a lot of people taking a ten to $15,000 loan with a lower interest rate. Some of the companies like Credit Karma or Experian Boost partner up with other companies that will give out personal loans. 


Family loan

Ask your family for a loan. If your family members have the means to give you an interest-free loan, I would consider that. It’s another option that I wish I had considered, but I was too proud to ask about it. 

Snowball vs avalanche

4. Control your spending 

With all the options we just discussed, we all know that at the end of the day, it's all going to come down to being disciplined and having enough money to pay everything off.


The biggest thing that I did was that I just got very disciplined with my spending. I created a spreadsheet. I wrote down all my typical monthly expenses and figured out the things I could cut out to save some money and put more of it towards debt. 


It can be hard to change your lifestyle until you pay off your debt. I was very motivated because I knew that getting rid of debt meant creating more financial freedom for myself. 


If you feel like you're already living a very minimalistic lifestyle and you're already on a tight budget, I would consider getting some side gigs or maybe an extra part-time job on top of your full-time job.


Snowball vs avalanche

Getting rid of debt just made such a big difference in my life. I now have a much higher quality of life because I'm not constantly being held back by all the debts. Whether you use the Snowball Method or the Avalanche method to pay off your debt, or one of my other suggestions, paying off credit card debt is a freeing feeling.

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