Two ways to clear the same pile

If you owe money on a few different things — a credit card here, an overdraft there, a personal loan and perhaps a catalogue account — the real question isn't whether you'll pay it off. It's the order in which you attack it. Get that order right and you'll finish sooner, pay less interest and stay on track. Drift along paying minimums and the balance can sit there for years.

Two strategies dominate the conversation: the avalanche method and the snowball method. Both ask you to keep paying the minimum on everything while throwing every spare pound at one chosen debt. They differ only in which debt you pick first — and that difference matters more than you might expect.

The avalanche method: highest interest first

With the avalanche, you list your debts by interest rate, highest to lowest, and attack the most expensive one first. Once that's cleared, you roll its payment into the next highest, and so on.

This is the mathematically efficient option. A credit card at 22.9% APR costs you far more each month than a personal loan at 7.9%, so clearing the card first stops the bleeding fastest. Over the life of your repayments, the avalanche usually means less interest paid and less total time in debt.

The catch is emotional. The highest-rate debt often isn't the smallest, so your first victory might be six or twelve months away. Some people find that hard to sustain.

The snowball method: smallest balance first

The snowball flips the order. You ignore interest rates and target the smallest balance first, then the next smallest, and so on.

You'll usually pay a little more interest overall, but you get a quick win — often within a couple of months. That early momentum is powerful. People who clear a visible balance are far more likely to keep going, and if you've ever abandoned a repayment plan because it felt like nothing was changing, the snowball may suit you better.

What the numbers look like

Say you owe £3,000 on a personal loan at 7.9%, £3,500 on a credit card at 22.9% and £1,500 on a store card at 19.9%. You can afford £500 a month in total.

• Avalanche: you clear the credit card first, then the store card, then the loan.
• Snowball: you clear the store card first, then the loan, then the credit card.

On figures like these, the avalanche typically saves a few hundred pounds in interest and finishes a month or two earlier. The snowball gets an account to zero inside the first few months. Both beat paying minimums and hoping.

Worth knowing: minimum payments on credit cards are set deliberately low, and lenders must nudge you if you've been stuck on them for a long stretch. If that letter has arrived, treat it as a signal rather than a nuisance.

Keeping momentum when life gets in the way

• List every debt: balance, rate, minimum payment, and the date each payment leaves your account.
• Fix one total monthly payment and never reduce it. As debts clear, the freed-up money becomes your snowball.
• Set up standing orders for the day after payday, so the money moves before you can spend it.
• Build a small buffer of a few hundred pounds. Without it, a car repair lands straight back on a card.
• Check your credit file for errors — a wrong default can hold you back for years.
• Be cautious with 0% balance transfers. They can help, but the fee, the expiry date and the temptation to reuse the old card all need managing.

If the total feels unmanageable or you're missing payments, stop trying to optimise and get free, impartial advice from a debt charity. Options such as a debt management plan, an individual voluntary arrangement or the Breathing Space scheme can pause interest and enforcement while you sort things out — and the advice itself costs nothing.

Choosing what suits you

There's no universal winner. If you're motivated by spreadsheets and the lowest possible cost, run the avalanche. If you need to see an account at zero to believe the plan is working, run the snowball.

A practical middle ground: use the snowball to knock out any small balance under a few hundred pounds, then switch to the avalanche for the rest. You get an early win and efficient clearing afterwards.

Remember the real point, though. The method matters, but the amount you commit each month matters more. Paying £500 consistently beats choosing the perfect order and paying £200. Pick one, write it down, tell someone who'll ask you about it, and start with the next payment date.