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Strategy

Avalanche vs Snowball

Two ways to pay off debt faster. One saves the most money. The other keeps you motivated. Both work, and Finvy can switch between them on demand.

4 min read·Strategy

When you have more than one debt, you have to decide where the extra money goes after the minimums are covered. The two most-tested strategies are Avalanche and Snowball.

Avalanche: highest APR first

Pay the minimum on every debt, then put every extra dollar against the debt with the highest interest rate. Once it is gone, roll its payment into the next-highest APR. Mathematically optimal: it pays the least interest over the life of the plan.

Snowball: smallest balance first

Pay the minimum on every debt, then put every extra dollar against the debt with the smallest balance. Once it is gone, roll its payment into the next smallest. Psychologically powerful: you knock out a whole debt in weeks or months, and that momentum keeps you paying.

Which one is right for you?

The honest answer is: the one you will actually stick with. Research by economists at Northwestern and Booth has shown that people who use Snowball are more likely to finish paying off their debt, even though Avalanche would have saved them more money. If you have failed past plans because of fatigue, Snowball is probably the better fit. If you are disciplined and motivated by math, Avalanche wins.

Saves most interest
Avalanche
Builds momentum
Snowball
Hybrid option
Finvy

What Finvy does

Pick Avalanche, Snowball, or AI-Hybrid in Settings. The Forecast page lets you swap strategies and see months-to-debt-free and total interest update live, so you can compare them against your real balances and APRs before committing.

Key takeaway
Snowball if you have started and stopped before. Avalanche if you want the cheapest path. Either way, Finvy keeps the same payment rolling forward as each debt is cleared.
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