What is the debt avalanche method?

The avalanche method prioritises paying off the debt with the highest interest rate first, while making minimum payments on everything else. Once the highest-rate debt is cleared, you "avalanche" the freed-up money onto the next highest rate. This approach minimises the total interest you pay over time.

What is the debt snowball method?

The snowball method prioritises the smallest balance debt first, regardless of interest rate. The idea is that paying off smaller debts quickly creates psychological wins and momentum that keep you motivated. You may pay slightly more interest overall, but many people find they're more likely to stick with the plan.

Which method should I use?

If saving money is your top priority, the avalanche method is mathematically superior as it minimises interest costs. If staying motivated is your challenge, the snowball method may work better because early quick wins keep you on track. The best method is the one you will actually stick to.

What counts as a minimum payment?

For credit cards, the minimum payment is usually 1-3% of the outstanding balance or a fixed minimum (e.g. £25), whichever is higher. For loans it is the fixed monthly instalment. Use the minimum payment shown on your most recent statement or credit agreement.

How does the extra payment work?

The extra payment is the amount you can afford to pay above your total minimum payments each month. Under both methods, this extra amount is directed entirely at the priority debt (highest rate for avalanche, smallest balance for snowball). When that debt is cleared, its minimum payment is also rolled into the extra on the next debt.

Debt Management

Debt Payoff Planner

Compare the avalanche and snowball methods side-by-side. See how much interest you save and when you'll be debt-free.

Updated April 2026

Your details

Your debts

Balance (£)

APR (%)

Min pay (£)

Balance (£)

APR (%)

Min pay (£)

Balance (£)

APR (%)

Min pay (£)

Extra monthly payment

Amount above minimum payments directed at your priority debt each month

Your results

Payoff Plan for £23,500 Across 3 Debts

Total debt to clear

£23,500

Across 3 debts

Total monthly budget: £665
Avalanche: debt-free in: 42 months
Snowball: debt-free in: 42 months

Breakdown

Avalanche

Saves most

Highest interest rate first

Debt-free in42 months

Total interest£3,699

Total paid£27,199

Snowball

Quick wins

Smallest balance first

Debt-free in42 months

Total interest£3,699

Total paid£27,199

Both methods give the same result, either because interest rates are equal or there's only one debt.

Related calculators

Net Worth Calculator Savings Goal Calculator Compound Interest Calculator

Frequently asked questions

Sources & methodology

Built and maintained by Tim, a personal finance enthusiast (not a financial adviser). Last reviewed April 2026. Rates and thresholds come from official UK government publications.

GOV.UK · UK government legislation and guidance
HMRC · Tax rates, thresholds and official guidance

Figures are estimates only. This is not financial or tax advice. For help with your specific situation, speak to HMRC or a qualified adviser.