Paying student loans

Snowball vs avalanche repayment strategies

May 02, 2024 – 3 mins

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What method is right for you?

So you’ve got some student loan debt and want to figure out the best way to pay it off. There are two popular strategies people use—the snowball and avalanche methods. Here’s a bit of info on each so you can decide which might work best for your situation.

Snowball vs avalanche

Both methods have the same goal—no debt—but they use different steps to get there. The avalanche method prioritizes eliminating high-interest debt, while the snowball method prioritizes paying off your smallest debt first.

Snowball method

With the snowball method, you start by paying off your smallest debt. Once that clears, you move on to the next smallest one, and then the next smallest, and so on. This method can feel good (and motivating) because you’ll see quick wins, but it might not be the best for saving money on interest.

Here’s how to get that snowball rolling:

Make a list of your debts. Then organize them by balance, from smallest to largest.
Attack the smallest debt. Use any extra funds you have towards paying it off while making minimum payments on the others.
Start the snowball effect: Once that smallest debt is paid off, roll all the money you were using on it over to the next smallest debt, and continue until everything is paid off.

Avalanche method

The avalanche method is all about tackling debts with the highest interest rates first. This way, you save more money in the long run, but it might take longer to see results.

Here’s how to kick off the avalanche:

Make a list of your debts. Then organize them by interest rate—highest to lowest.
Pay extra. Use any extra funds you have towards the debt with the highest interest rate while continuing to make minimum payments on the rest.
Start the avalanche effect: As you pay off each balance, use that money to conquer the next debt (with the next highest interest rate) on your list until you’re debt-free.

Bonus tip!

Signing up for auto debit is a smart move no matter if you choose the avalanche or snowball method. Automated payments keep track of your due dates for you so you never miss a payment—and our customers get a %0.25 discount.^{footnote 1} Win, win, win.

So which one is better?

There’s no right answer here. Do you want to tackle high-interest debts head-on with the avalanche method, or do you want to build momentum with small victories using the snowball method? The key is to choose a strategy that works best for you and keeps you committed to your goals.

footnote Sallie Mae does not provide, and these materials are not meant to convey, financial, tax, or legal advice. Consult your own financial advisor, tax advisor, or attorney about your specific circumstances.

footnote External links and third-party references are provided for informational purposes only. Sallie Mae cannot guarantee the accuracy of the information provided by any third parties and assumes no responsibility for any errors or omissions contained therein. Any copyrights, trademarks, and/or service marks used in these materials are the property of their respective owners.

footnote Sallie Mae, the Sallie Mae logo, and other Sallie Mae names and logos are service marks or registered service marks of Sallie Mae Bank. All other names and logos used are the trademarks or service marks of their respective owners.

footnote 1. The borrower or cosigner must enroll in auto debit through Sallie Mae to receive a 0.25 percentage point interest rate reduction benefit. This benefit applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month. It may be suspended during forbearance or deferment, if available for the loan.