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January 9, 2024

Paying Off Debt: Snowball vs. Avalanche

Debt doesn’t have to be a dirty word.

Many of us rely on loans whether for school, a home, or unexpected expenses. While loans can be a valuable resource, managing them wisely is crucial for financial well-being. Navigating through debt can be an overwhelming task, but with a strategic approach, you can take control of your financial journey.

Here, we explore two common methods – the snowball and the avalanche – to help you stay focused on clearing your debts.

The Snowball Method

List Your Debts:

Start by listing all your debts, including credit cards, bills, and loans, from the lowest to the highest amounts.

Minimum Payments:

Next, make the minimum monthly payment on each bill, using any extra money you have towards clearing the total balance of the lowest bill.

Snowball Effect:

As you progress from the smallest balance to the next on your list, the amount you can pay “snowballs.” This method provides an encouraging boost as you witness debts getting paid off quickly, creating momentum for tackling larger debts.

The Avalanche Method

List by Interest Rates:

List and pay your debts from those with the highest interest rates to the lowest. This strategic approach helps you tackle high-interest debts first as you slide your way down the debt mountain, saving money in the long run.

Interest Cost Savings:

By prioritizing high-interest debts, you minimize interest costs over time, making efficient use of your payments.

The decision between the snowball and avalanche methods depends on your preferences and financial goals.

The snowball strategy can be encouraging because you’ll see debts getting paid quickly, while the avalanche attack can save money by paying less interest costs over time.

Clearing your debts may seem challenging, but with a well-defined strategy, you can take positive steps toward financial freedom.

About Fidelity Bank
Fidelity Bank has built a strong history as a trusted financial advisor and continues its mission of exceeding client expectations through a unique banking experience. It operates full-service offices throughout Lackawanna, Luzerne, Lehigh, and Northampton Counties, along with a limited production commercial office in Luzerne County and a Fidelity Bank Wealth Management Office in Schuylkill County. Fidelity Bank provides a digital banking experience online at, through the Fidelity Mobile Banking App, and in the Client Care Center at 1-800-388-4380. Part of the Company’s vision is to serve as the best bank for the community, which was accomplished by having provided over 4,100 hours of volunteer time and over $1.7 million in donations to non-profit organizations directly within the markets served throughout 2022. Fidelity Bank’s deposits are insured by the Federal Deposit Insurance Corporation up to the full extent permitted by law.