The two methods
Both methods pay the minimum on every debt, every month. The difference is where the extra goes.
Avalanche puts every spare dollar on the debt with the highest interest rate. When it's gone, that debt's payment rolls onto the next highest. It almost always costs the least interest. That's just math.
Snowball puts every spare dollar on the smallest balance first, whatever its rate. You clear a debt sooner, which feels like progress, and the freed payment rolls onto the next smallest.
The real question
Avalanche is usually cheaper. Snowball is easier to stick to for some people, and a plan you stick to beats a cheaper plan you give up on in month three. This calculator shows exactly how much the easier path costs, so you decide with the number in front of you.
Where the mortgage fits
Leave a fixed-rate mortgage out of this list. At 3% to 7% it's almost certainly your cheapest debt, and card debt at 22% costs several times as much per dollar. Clear the expensive debts first.
Buy now, pay later
Pay-in-four plans usually charge no interest if you pay on time, so avalanche puts them last. Late fees aren't counted here. If you're paying late fees, treat that plan as your most expensive debt.
