Avalanche: Paying off loans with the highest interest rate first.
Snowball: Paying off loans with the lowest balance first.
While avalanche results in paying less interest, as well as being debt free sooner, snowball pays off individual loans faster, which can be motivating!
Depending on your loans, the outcome may be the same regardless of the method used.
unbury.us is a loan calculator designed to help you get debt-free as fast as possible. Once your
loan information is entered, you may set the total amount you're able to put towards loans in a
month. If this amount is greater than the minimum you're able to pay on loans, the extra money is
put towards one loan every month to eliminate it. Once a loan is paid off, the money that was
previously going towards that loan is now put towards the next loan, and so forth.
The order of which loans are paid off first is either highest-to-lowest interest rate (Avalanche),
or lowest-to-highest remaining principal (Snowball), depending on which you choose.
Put just an extra $100 a month towards your loans and see how much time and interest paid you save!