Avalanche or snowball?
Both methods pay the minimum on every debt and put every extra dollar toward one target. Once that debt is gone, its payment "rolls" to the next one.
- Avalanche targets the highest interest rate first. It is mathematically the cheapest.
- Snowball targets the smallest balance first. Early wins keep many people motivated, and the method that keeps you going is the one that works.
The average credit card APR right now is 21.19% (Federal Reserve). Paying off a card at that rate is like earning a guaranteed 21% return.