Avalanche vs. Snowball: Run It on Your Own Cards
Avalanche saves more money. Snowball keeps more people going. The right answer is whichever one you'll still be doing in month eight.
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Key takeaways
- Avalanche (highest APR first) is mathematically optimal; snowball (smallest balance first) closes accounts fastest.
- On most real card mixes the dollar gap between methods is under 5% of total interest.
- Raising the monthly payment beats switching methods every time.
The two methods
- Avalanche: minimums on everything, every extra dollar to the highest APR. Mathematically optimal.
- Snowball: minimums on everything, every extra dollar to the smallest balance. Closes accounts fastest, which is motivating.
An example with four cards
Card A: $900 at 18%. Card B: $2,400 at 29%. Card C: $4,100 at 22%. Card D: $600 at 26%. Budget: $650 a month total.
Avalanche attacks B first (29%), then D, then C, then A. Snowball attacks D first ($600), then A, then B, then C. On this set, avalanche finishes a month or two sooner and saves a few hundred dollars in interest. Snowball pays off two cards in the first five months.
The gap is usually under 5% of total interest
On most real card mixes, the dollar difference between methods is small relative to the difference between doing either one and doing neither.
How to choose
If one card's APR is far above the rest (a 29.99% card among 19% cards), use avalanche; the gap is real money. If the APRs are clustered within a few points, use snowball; the early wins matter more than the rounding. Either way, the lever that actually moves the number is the $650. Raising it to $750 beats switching methods every time.
The hybrid
Pay off the one smallest balance first for the win, then switch to avalanche for the rest. Most people who finish use some version of this.
The bottom line
Raising the payment beats switching methods every time.
