Debt Snowball vs Debt Avalanche: Which Method Works Better?
Debt can feel overwhelming. Many people struggle to decide the best way to pay it off quickly without burning out. That’s where two proven strategies come in: Debt Snowball vs Debt Avalanche.
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Both methods help you eliminate debt, but they work differently. One focuses on quick wins, while the other saves you more money long-term. Which is right for you? Let’s break it down.
What Is the Debt Snowball Method?
The Debt Snowball method focuses on paying off debts from the smallest balance to the largest—regardless of interest rates.
How it works:
- List all your debts from smallest to largest.
- Pay the minimum on all except the smallest debt.
- Throw all extra money at the smallest debt until it’s gone.
- Roll the freed-up money into the next debt.
✅ Pros: Builds motivation with fast wins. Boosts confidence.
❌ Cons: May cost more in interest compared to avalanche.
💡 Example:
- Credit Card A: RM1,000 (18% interest)
- Personal Loan: RM5,000 (10% interest)
- Car Loan: RM20,000 (5% interest)
With Debt Snowball, you clear the RM1,000 card first even though it has the highest interest because it’s the smallest balance.
What Is the Debt Avalanche Method?
The Debt Avalanche method attacks debt based on the highest interest rate first.
How it works:
- List debts from highest to lowest interest rate.
- Pay the minimum on all except the highest-interest debt.
- Throw extra money at the highest-interest debt.
- Once cleared, move to the next highest.
✅ Pros: Saves more money on interest. Pays off debt faster overall.
❌ Cons: May feel slower in the beginning requires discipline.
💡 Example (same debts as above):
- Credit Card A (18%) → focus first.
- Personal Loan (10%) → second.
- Car Loan (5%) → last.
With Avalanche, you pay the card first because of interest, not balance.
Debt Snowball vs Debt Avalanche: Side-by-Side Comparison
| Feature | Debt Snowball | Debt Avalanche |
|---|---|---|
| Focus | Smallest debt | Highest interest |
| Motivation | Faster wins | Long-term savings |
| Best for | Beginners, emotional boost | Discipline, math-driven people |
| Total interest paid | Higher | Lower |
| Speed of payoff | Slower overall | Faster overall |
Which Method Works Better?
The big question: Debt Snowball vs Debt Avalanche—which is better?
- If you need quick wins and emotional motivation, Debt Snowball works better. It keeps you excited and builds momentum.
- If you’re disciplined and focused on saving money, Debt Avalanche is smarter long-term.
👉 The truth: The best method is the one you’ll actually stick to.
Frequently Asked Questions
Does Debt Snowball cost more in the long run?
Yes, because you may pay more interest. But many people succeed with it because small wins keep them motivated.
Can I mix both methods?
Absolutely. Some Malaysians start with Snowball for motivation, then switch to Avalanche once confident.
Final Thoughts: Debt Snowball vs Debt Avalanche
At the end of the day, Debt Snowball vs Debt Avalanche is not about right or wrong, it’s about what works for you. Both methods lead to the same goal: a debt-free life.
Start today. List your debts, pick a method, and stay consistent. Whether you choose quick wins or interest savings, the most important step is action. Your future self will thank you.
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