Glossary term
Debt Snowball
The debt snowball is a payoff strategy where you pay minimums on everything and direct all extra money to the smallest balance first, regardless of interest rate. Each payoff frees up a payment that rolls into the next-smallest debt. It can cost more interest than the avalanche but delivers quick wins that help many people stay on track.
Updated October 17, 2026 · Editorial Team
How Debt Snowball works in practice
Sort your debts from smallest to largest balance. Each month, make every minimum payment and send any extra cash to the smallest one. When it is paid off, add its old payment to the extra and move to the next. The payment you are throwing at each new target keeps growing, like a rolling snowball.
With $2,000 at 25% (minimum $60), $6,000 at 18% (minimum $150) and $900 at 9% (minimum $30), and $450 a month, the snowball pays the $900 debt first. Assuming monthly interest and no new charges, everything is gone in 24 months with $1,834.40 in interest, $158.38 more than the avalanche order.
The extra cost depends on how far your smallest balances are from your highest rates. If the gap is small, the snowball's quick wins may be worth it. If one small debt carries a low rate and a large one a very high rate, the cost of the snowball can climb.
Debt Snowball: quick questions
Why would I choose the snowball if it costs more?
Paying off whole accounts quickly can keep you motivated. A plan you stick with beats a cheaper one you abandon.
How much more does the snowball usually cost?
It depends on your balances and rates. In our three-debt example the difference was $158.38 over two years.
Can I mix the two methods?
Yes. Some people clear one tiny balance first, then switch to highest-rate order for the rest.
Sources
- Credit cards — Consumer Financial Protection Bureau. Accessed October 17, 2026.
- Debt collection — Consumer Financial Protection Bureau. Accessed October 17, 2026.
We cite primary sources: regulators, central-bank data and federal agencies. Worked examples on this page are our own calculations. See our methodology.
Put the definition to work.
Change one input and watch how this term moves your result.