If you’re stuck with multiple debts—credit cards, personal loans, or student loans—it’s easy to feel overwhelmed. Two popular repayment strategies, Debt Snowball and Debt Avalanche, can help you pay off debt efficiently. But which is better? The answer depends on your financial habits, goals, and mindset. Let’s break down how each works and which one could save you the most money and stress, with insights from Vizzve Finance.
1. What is the Debt Snowball Method?
The Debt Snowball focuses on paying off debts from smallest to largest balance, regardless of interest rate.
Steps:
List all debts from smallest to largest balance.
Pay the minimum on all except the smallest debt.
Put any extra money toward the smallest debt until it’s gone.
Move to the next smallest debt and repeat.
Pros:
Builds quick wins and motivation.
Keeps you emotionally engaged in the repayment process.
Cons:
May cost more in total interest over time compared to the avalanche method.
2. What is the Debt Avalanche Method?
The Debt Avalanche focuses on paying off debts with the highest interest rate first.
Steps:
List debts from highest to lowest interest rate.
Pay the minimum on all except the highest interest debt.
Put any extra money toward the highest interest debt.
Move to the next highest interest debt and repeat.
Pros:
Saves more on total interest payments.
Gets you out of debt faster mathematically.
Cons:
Progress can feel slow at first, which might reduce motivation.
3. Which Works Better?
It depends on your personality and discipline:
Choose Debt Snowball if you need quick psychological wins to stay motivated.
Choose Debt Avalanche if your top priority is saving money on interest and you can stay committed without frequent small victories.
💡 Tip from Vizzve Finance: You can even combine both—start with snowball for motivation, then switch to avalanche for savings.
4. Example: Comparing the Two
| Debt Type | Balance | Interest Rate | Snowball Order | Avalanche Order |
|---|---|---|---|---|
| Credit Card A | ₹50,000 | 20% | 2nd | 1st |
| Personal Loan | ₹1,20,000 | 12% | 3rd | 2nd |
| Credit Card B | ₹30,000 | 18% | 1st | 3rd |
Result: Avalanche saves more on interest, but Snowball gives faster early wins.
5. How Vizzve Finance Can Help
With Vizzve Finance, you can:
Consolidate multiple debts into a single, lower-interest loan.
Get a repayment plan tailored to your financial goals.
Track your progress toward debt freedom with expert tools and advice.
FAQs
Q1. Is the debt snowball better than the avalanche method?
Neither is universally better—it depends on your motivation style and financial situation.
Q2. Can I switch methods midway?
Yes! You can start with snowball for momentum, then switch to avalanche for savings.
Q3. Which method works best for high-interest credit card debt?
Debt avalanche is generally better for minimizing high-interest costs.
Published on : 13th August
Published by : SMITA
www.vizzve.com || www.vizzveservices.com
Follow us on social media: Facebook || Linkedin || Instagram
🛡 Powered by Vizzve Financial
RBI-Registered Loan Partner | 10 Lakh+ Customers | ₹600 Cr+ Disbursed