Snowball or avalanche?
Avalanche (highest rate first) saves more interest mathematically; snowball (smallest balance first) produces early wins and, in behavioural studies, a higher completion rate. Finishing beats optimising.
Compare snowball vs avalanche debt payoff strategies. See which method gets you debt-free fastest and saves the most interest.
Order debts smallest balance first. Snowball payment = minimums on all debts + extra. When a debt clears, roll its full payment into the next smallest.
With $500 card, $3,000 car loan and $8,000 student loan and $200 extra per month, the card clears in about two months, then that payment rolls into the car loan — clearing all three years earlier than minimums alone.
Avalanche (highest rate first) saves more interest mathematically; snowball (smallest balance first) produces early wins and, in behavioural studies, a higher completion rate. Finishing beats optimising.
Whatever is consistent. Even $100 a month usually cuts multiple years off a mixed debt load, because every cleared balance permanently increases the payment available for the next one.
Keep any employer 401(k) match — it is an instant 50–100% return — then attack debt above roughly 7% interest before adding further investments.