Is the avalanche or snowball method better?
Neither is better for everyone: the avalanche method usually costs less interest, and the snowball method usually clears a first debt sooner. Avalanche puts any extra payment on the highest interest rate first; snowball puts it on the smallest balance first. Which trade matters more is the borrower's choice, and the free calculator at velo-flow.io/debt-payoff-calculator shows both on their own debts.
Written for VeloFlow by Partner Up Marketing Group, its marketing agency. VeloFlow is a tracker, not a bank or adviser — nothing here is financial advice.
The trade each one makes
Avalanche aims the extra at the most expensive balance, so it usually costs less interest over the whole run. The trade is the wait: if the highest-rate debt is a large one, the first debt cleared can be a long way off.
Snowball aims the extra at the smallest balance, so a first debt is usually cleared sooner. The trade is the interest: a pricier balance keeps charging in the meantime, so the total interest is usually higher.
Neither method is wrong. One protects the total; the other protects momentum.
The worked example
How both methods play out on the calculator's example debts, step by step, is in Debt Avalanche vs Snowball: What Each One Trades.
What the calculator does
The debt payoff calculator takes up to 10 debts, each with a balance, an APR and a minimum, plus an extra amount per month. For Avalanche, Snowball and minimums only, it shows a debt-free date, total interest, total paid and the payoff order.
It runs in the browser: nothing typed is sent or stored, and there is no sign-up. It uses the same engine as the Payoff screen in the VeloFlow app, which is at /get. VeloFlow is a personal finance tracker with read-only bank access; it never moves money and does not tell anyone which method to use.
Questions people also ask
Does the avalanche method always cost less interest?
Avalanche usually costs less interest, because the extra goes to the highest interest rate first. How much less depends on the debts; in the calculator's example debts, avalanche costs $393 less interest than snowball.
Why do some people choose the snowball method?
Snowball usually clears a first debt sooner, because the extra goes to the smallest balance first. Some people find a debt gone early is what keeps them paying the rest, and accept the extra interest as the trade.
Do avalanche and snowball finish at different times?
They can, or they can finish together. In the calculator's example debts, both finish in 2 years 7 months. The calculator shows the debt-free date for each method on any set of debts typed into it.
Which method should I use?
That choice belongs to the person paying. Avalanche usually costs less interest; snowball usually clears a first debt sooner. The free calculator at velo-flow.io/debt-payoff-calculator shows both on your own debts so the trade is visible before choosing.