The Debt Snowball Vs Debt Avalanche Method: Which One Is Right For You?

September 16, 2021 | Louis Tully

debt snowball vs debt avalanche

Debt snowball and debt avalanche have recently become clear frontrunners among the methods of debt payoff. While the supporters of both have their arguments about why one is better than the other, there’s no clear winner in the debt snowball vs debt avalanche debate. Each has its benefits and drawbacks. Their success depends on the person’s personality, their weaknesses, and what they’re willing to give up during the debt payoff period.

The Debt Snowfall Vs Debt Avalanche: How To Decide

Which Is Better In Terms Of Positive Reinforcement?

The debt snowball method works like this – you list all your debt from smallest to the largest, and then put all your extra money towards paying off the smallest, while making minimum payments on all the rest. When the smallest debt is paid off, the extra money starts going to the second smallest and so on.

The big upside of this method is that you get to see a lot of progress in the first few months, knocking out debts and freeing up money to make extra payments on the next ones. The downside is that interest rates don’t play part in this strategy, so you might need to keep your highest-interest debt at the end of the list.

For a while debt snowball method was the unequivocal leader due to money guru, Dave Ramsey’s influence, but as the community grew, so did the popularity of alternative methods – particularly of debt avalanche.

Debt Snowball Vs Debt Avalanche: What’s Better For Potential Savings?

The debt avalanche, on the other hand, prioritizes interest rates. You again list all your debts to determine the payoff order – only this time you list them from largest interest rates to the smallest. The biggest upside is that you’ll be paying less interest on your debt as a whole, knocking off the ones with the largest interest first.

debt snowball vs debt avalanche

The downside is that it may take some time before you see any debts paid off and free up extra cash to throw at the next one. This is a method that requires you to double down in the beginning and wait for a while before you see any tangible results.

Debt Snowball Vs Debt Avalanche: How To Choose

If you have trouble motivating yourself, are prone to hopelessness, and there’s a chance you may stop debt payoff if any difficulties arise – debt snowball would work better for you. Seeing results first would motivate you, and if you need to pause the payoff for any reason, who would have higher chances of having already achieved tangible results.

If you have better control over your money (and spending habits), and easily find motivation by crunching numbers and keeping potential financial gain in mind, then debt avalanche would work better for you. It may take some time for you to see tangible results, but after you’ve paid your first debt off and seen how much you saved on interest, the whole process would become easier.

How To Handle Debt The Correct Way

If there’s a downside to the whole debt-payoff craze, it’s how scared people have become of acquiring debt. People, in general, seem to be prone to extremities. Extreme debt acquisition taking has had a heavy toll, so now many have decided that acquiring any kind of debt will be ruinous.

In reality, debt can be helpful if used in a measured and well-planned way. If acquired when needed, it can help you avoid further financial pitfalls. For example, if you suddenly run into an emergency, title pawns might be worth looking into.

How Title Pawns May Help

Some problems may exacerbate and cost you more in the future. It’s all about pros and cons, and in time-sensitive situations (health emergencies, urgent repairs, overdue bills) the pros may outweigh the cons. If you are at risk of defaulting on your existing debt or missing several payments, a title pawn might be an option for you to consider.

Title pawns are easy to apply for (all you need is a state-issued ID proving you’re 18+, a car, and its lien-free title in your name), and are accessible to people of all credit and employment situations.

All you need to get started is either call your preferred store location or submit an inquiry form for car title pawns online and wait for the store representative to give you a call to guide you through the rest of the process.

Bring your ID, your car, and your car’s lien-free title to the nearest storefront. The associate will need to assess everything and determine if you qualify for the loan and on what the terms. If they decide to approve you, you’ll get the cash you qualified for either the same or next business day.

woman with title pawn cash

Submit Inquiry For Title Pawns Today!

Whichever the method you choose for getting your financial life back on track, remember that you have an option to deal with the unexpected by resorting to title pawns. You can get started today by submitting a short online inquiry for a Georgia title pawn on our website or by calling us directly at 800-514-2274.