Both strategies attack debt systematically. The difference is the ordering principle: snowball pays smallest balance first (psychological wins). Avalanche pays highest interest rate first (mathematical wins). Both outperform making random payments.
Debt Snowball — How It Works
List all debts from smallest to largest. Pay minimums on all except the smallest, which gets every spare dollar. When it's paid off, roll that payment to the next-smallest. The psychological effect: quick wins build momentum. The Total Money Makeover popularized the snowball approach — many people who failed with the avalanche method succeed with snowball because it keeps them engaged and builds behavioral momentum.
Debt Avalanche — How It Works
List all debts from highest to lowest interest rate. Pay minimums on all except the highest-rate debt, which gets every spare dollar. When it's paid off, roll that payment to the next-highest. The mathematical advantage: you pay the least total interest over the payoff period.
The Numbers
Scenario: $20,000 in debt across three cards — $5,000 at 18%, $7,000 at 22%, $8,000 at 26%. You have $600/month above minimums. Avalanche: pay off in ~27 months, $2,340 in interest. Snowball: pay off in ~28 months, $2,420 in interest. The difference is $80 over 2 years — meaningful, but small enough that behavior wins.
The Verdict
If you have a history of abandoning debt payoff plans, use snowball for the momentum effect. If you are confident in your discipline and the interest math matters to you, use avalanche. Either is better than paying only minimums and letting debt compound for 20 years.