When you have multiple debts, the two most common payoff strategies are the avalanche and the snowball. Both keep you making the same minimum payments, then direct extra cash at one debt at a time.
The avalanche
Pay minimums on everything, then put all extra money toward the debt with the highest interest rate. Once that is gone, roll its payment to the next highest rate.
- Pros: mathematically optimal. You pay the least total interest.
- Cons: the first win can take a long time if your highest-rate debt is also your largest.
The snowball
Pay minimums, then target the smallest balance first, regardless of rate.
- Pros: quick early wins create momentum, which matters when motivation is the real constraint.
- Cons: you pay more interest overall.
How to choose
The best strategy is the one you will not abandon. If you are disciplined and the gap in rates is large, avalanche wins on cost. If you need visible progress to stay motivated, snowball wins on psychology.
A useful middle path: avalanche by rate, but keep your first target small enough to secure an early win.
Use the loan payment calculator to model the monthly numbers for any debt before you commit to a plan.