What this comparison works out
There are two well-established ways to order debt repayment. The avalanche method targets the highest interest rate first and costs the least. The snowball method targets the smallest balance first and clears whole debts soonest. This page helps you decide which suits your situation.
This is a guidance tool rather than a projection. It weighs the size of your smallest balance, the height of your worst interest rate and your own honest answer about whether you need visible early progress, then recommends a method and explains the trade-off.
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Before you decide
- Gather every balance and its APR. The spread between your highest and lowest rate is what determines how much the choice actually costs.
- Answer the motivation question honestly. A method you abandon in month four is worse than a slightly costlier method you finish.
- Note any 0% promotional periods and their end dates, as these sit outside both orderings until they expire.
- Confirm you can meet every minimum payment under either approach, because both depend on it.
If all your debts charge broadly similar rates, the two methods produce almost identical costs and you should simply pick the one you will stick to. The avalanche's advantage grows in proportion to the gap between your highest and lowest rate.
How this calculator works
The two orderings differ in one rule only:
Avalanche: pay minimums, then all spare money at the highest APR
Snowball: pay minimums, then all spare money at the smallest balance
In both: when a debt clears, roll its payment into the nextThe avalanche is mathematically optimal because interest accrues fastest on the highest rate, so removing that debt first reduces the total interest charged. No ordering can beat it on cost.
The snowball wins on completion speed for individual debts, which matters because sustained behaviour, not arithmetic, is what actually clears debt. Research into consumer repayment behaviour has repeatedly found that people who see whole balances disappear are more likely to keep going.
Worked example: a £500 balance and a 29.9% card
Using the default figures — four debts, a smallest balance of £500 and a highest APR of 29.9%:
- Avalanche: everything spare goes at the 29.9% debt. This costs the least, but if that debt is large you may see nothing clear for a year or more.
- Snowball: everything spare goes at the £500 balance. That debt disappears within a few months, and its minimum payment then joins the pot attacking the next one.
With a 29.9% rate in the mix, the avalanche's cost advantage here is real and worth having — that is a high rate to leave running. But if the £500 debt would clear in three months and you have tried and abandoned a repayment plan before, clearing it first buys something the spreadsheet cannot measure. Both answers are defensible; only one of them is one you will finish.
Common mistakes
- Choosing avalanche on principle and abandoning it. The cheapest method only saves money if you complete it.
- Switching between methods repeatedly. Each switch resets your momentum and delays every payoff date.
- Ignoring a 0% balance until it reverts. Diarise the end date; on the day it reverts, that debt may jump straight to the top of an avalanche list.
- Comparing on monthly payment rather than total cost. Both methods use the same monthly outlay — only the destination changes.
- Forgetting that fees count. A debt with monthly account fees can be more expensive than its APR alone suggests.
Frequently asked questions
How much more does the snowball actually cost?
It depends entirely on the spread of your rates and the size of the balances. Where rates are similar, the difference is often a few tens of pounds across a whole repayment plan. Where you have one very high-rate debt with a large balance sitting behind several small cheap ones, it can run into several hundred pounds. Calculate both if the spread is wide.
Can I combine the two?
Yes, and many people do. A common hybrid is to clear one or two very small balances first for the momentum, then switch to strict avalanche ordering for the rest. This captures most of the motivational benefit and most of the cost saving.
Where does a debt consolidation loan fit in?
It replaces several debts with one, which removes the ordering question entirely. It can reduce your rate and simplify payments, but it often extends the term — which can mean paying more overall despite a lower monthly figure — and moving unsecured debt onto a secured loan puts your home at risk. Take free advice before consolidating.
Should I close accounts as they clear?
There is no need to rush. Closing accounts reduces your total available credit, which can increase the proportion of credit you are using and affect your credit file. If an account tempts you to spend, closing it may still be the right call for behavioural reasons.
What if neither method is affordable?
Then the question is not which ordering to use. Contact Citizens Advice, StepChange or National Debtline for free and confidential advice — they can discuss options including payment plans and formal debt solutions that no calculator can assess.
Related tools
References
- MoneyHelper — free guidance on prioritising debts and choosing a repayment approach
- Financial Conduct Authority — regulation of consumer credit and debt advice standards
Sources are checked at publication and can change — how I choose and check references.