There are only two proven methods for paying off multiple debts. The avalanche saves you the most money. The snowball keeps you motivated. Here's how to decide which one to use — and how much the difference actually costs.
The avalanche method
Pay minimums on all debts. Direct every extra pound at the debt with the highest APR. When that's paid off, roll its minimum payment into the next-highest APR debt.
Best for: Credit card debt (typically 20–40% APR). The maths is unambiguous — you'll pay the least total interest possible.
The snowball method
Pay minimums on all debts. Direct every extra pound at the smallest balance regardless of interest rate. When the smallest is gone, roll its payment to the next smallest.
Best for: People who've struggled to stick to payoff plans before. Each eliminated debt provides a psychological win that research shows helps people stay on track longer.
Worked UK example
Barclaycard
£3,200 @ 29.9%
£64/mo min
Personal loan
£8,000 @ 9.9%
£180/mo min
Car finance
£5,500 @ 12.4%
£130/mo min
Extra available: £200/month
| Method | Paid off in | Total interest |
|---|---|---|
| Avalanche | 38 months | £2,140 |
| Snowball | 41 months | £2,490 |
| Minimums only | 62 months | £4,820 |
In this example, avalanche saves £350 over snowball. That's the typical difference — meaningful but not life-changing. If snowball helps you stay committed, the extra £350 is a worthwhile price for consistency. Try both strategies with your real numbers using FinSavvy's free debt payoff calculator.
What about UK student loans?
Don't include student loans in either method. Plan 2 loans (income-contingent, 30-year write-off) are almost never worth overpaying — the effective return is too low compared to investing in an ISA or paying off high-APR consumer debt.