What are the key differences between the two methods?
Debt Avalanche Method
The "Avalanche Method" to paying off debt is when you list your debts in order with the highest interest rate being first and working down to the lowest interest rate. Highly suggested by Suze Orman.
The benefit of the avalanche method is that you will pay off your debt faster and you will also pay less in interest. Depending of the size of your debt it can be daunting to look at and you run the risk of giving up because there is no momentum.
Download Printable Debt Avalanche Poster
Debt Snowball Method
The "Debt Snowball Method" is listing your debts from the smallest amount debt to the largest amount debt. Dave Ramsey's go to strategy.
The benefit of the snowball method is that you build up momentum by paying off your smallest debts faster than you possibly would using the avalanche method. You will probably end up paying more in interest and it could possibly take longer depending on your debt.
