Skip to main content
The debt avalanche method is a debt payoff strategy where you direct all your extra money toward the debt with the highest interest rate first, regardless of balance size. Once that debt is eliminated, you roll its payment into the next highest-rate debt. Because interest is the cost of carrying debt, attacking the most expensive debt first reduces what you pay in total over time.

​
How it works

1

List all your debts from highest interest rate to lowest

Write down every debt you owe — credit cards, student loans, personal loans, medical bills — ordered from the highest annual percentage rate (APR) to the lowest. Balance size does not determine the order.
2

Make the minimum payment on every debt each month

Keep every account current by paying at least the minimum on each debt. This protects your credit and prevents late fees or penalties.
3

Put all extra money toward the debt with the highest interest rate

Any money left over after minimums goes entirely toward the highest-rate debt. This is where you stop the most expensive interest from compounding.
4

When that debt is paid off, roll its payment to the next highest rate

Once the highest-rate debt is gone, take what you were paying on it — minimum plus any extra — and add that full amount to the minimum payment on the next debt in line.
5

Repeat until all debts are gone

Continue the cycle. Each paid-off debt reduces your total interest burden and accelerates the payoff of every remaining balance.

​
Why the avalanche works

Interest is the primary reason debt is expensive. A high-rate debt grows faster than a low-rate one, meaning every month you carry it costs you more. By eliminating your highest-rate debt first, you cut off the most expensive source of growth at the root. Mathematically, the avalanche method produces the lowest possible total interest paid and, in most cases, the shortest payoff timeline measured in dollars spent. If two strategies get you debt-free in the same number of months, the avalanche gets you there having spent less money overall. For people motivated by numbers — watching total interest shrink, seeing the long-term payoff date move closer — the avalanche provides the clearest evidence that the plan is working.

​
Example

Using the same three debts from the snowball example:
DebtBalanceInterest rateMinimum paymentAvalanche order
Credit card$3,20019.99%$801st — pay off first
Student loan$12,0005.5%$1302nd
Medical bill$5000%$253rd — pay off last
Under the avalanche method, every extra dollar goes toward the credit card because its 19.99% rate is the most expensive. Once it is paid off, you redirect that full payment to the student loan. The 0% medical bill, which costs you nothing in interest, is last.
The debt avalanche saves the most money over time. If you’re motivated by numbers and want to minimize total interest paid, this is your method.
If you find it hard to stay motivated before you see your first debt disappear, the snowball method may be a better fit. See What Is the Debt Snowball Method?.
Not sure which strategy fits you best? Read Choosing the Right Debt Payoff Strategy for a side-by-side comparison.