Debt Snowball Method
A payoff strategy that targets your smallest balance first for quick, motivating wins.
What does debt snowball method mean?
You pay minimums on everything and throw extra at the smallest debt; when it’s gone, its payment rolls to the next. It costs slightly more interest than the avalanche but its early wins help people stay the course.
Related terms
Debt Snowball Method — frequently asked
How does the debt snowball method work?
You pay minimums on every debt and throw all extra money at the smallest balance first. Once it is gone you roll that payment into the next-smallest, building momentum through quick, motivating wins.
Snowball or avalanche — which saves more money?
The avalanche (highest rate first) saves the most interest mathematically. The snowball costs a little more but delivers faster visible wins, which helps many people actually finish. The best method is the one you stick with.