How To Pay Off Debt (Debt Snowball vs Debt Avalanche)

In this video I show you how to pay off debt using the Debt Snowball or the Debt Avalanche method.

There are two fundamental differences between the Debt Snowball and the Debt Avalanche methods, which we go over in this video.

Essentially, the Debt Snowball method has you paying off your debt in order of smallest amount owed to the largest amount owed regardless of interest rate.

The debt Avalanche, however, has you paying off your debt from highest interest rate to lowest interest rate, regardless of amount owed.

There are pros and cons to both, and I will show you in a real Excel spreadsheet how the debt snowball and the debt Avalanche will help you pay off debt!

Make sure you watch until the end of this video to fully understand how to pay off debt using the Debt Snowball and Debt Avalanche strategies!

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My mission is to provide my viewers with actionable content that enables them to create financial wealth. My videos are a reflection of my real-world experience as a real estate investor, stock market investor, student of finance, and entrepreneur.

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[WhiteBoardFinance]

*Which method do you think is better?*

[jlshoem]

Many years ago, I paid off a car loan. I was so happy to have that money available. Then, it hit me. I was used to paying for the car loan. So, I started paying myself, instead. I put that payment in my savings account every month. In less than two years, I had the money to buy a new car, but I didn't. I didn't need a car, and my savings kept rising.
Every time I would get a raise, I would add that additional amount to the mortgage on my house. I paid the mortgage off several years early.

[GrowthePiggyBank]

Informative! I used the debt snowball to pay off $25k with a $35k income in 1.5 yrs. no matter how u do it, it’s worth being financially free!

[davidreus]

Big ups to everyone working effortlessly trying to earn a living while building wealth. I am 50 and my wife 44 we are both retired with the net worth of over $3million with no depts. Currently living smart and frugal with our money. Saving and investing lifestyle in the financial market made it possible for us this early even till now earn monthly through passive income.

[hiitsme]

Sick of being stuck in debt constantly paying for stupid decisions I’ve made in the past day 1 man coming back here to update thanks for the lesson bro

[GeorgeAusters]

As dave says though... If you think its a math problem then you wouldn't be in debt to begin with... It's a behavior problem that you think its okay to get into debt

[jack_k]

I appreciate how you cut out all the nonsense and get right to the meat of the lesson/issue in easy to understand language and concepts. Thanks for all your effort.

[buddyrevell]

Thank you for providing the calculator to determine the difference, snowball vs avalanche. I'm seeing so much advice about why snowball is recommended, but seeing the raw savings using avalanche I find it even more motivating so I'm choosing that method.

[JimmyKnves]

The snowball worked for me! Debt free as of January 15th 👌

[Enrique-fhhn]

For people who struggle to save, I'd try the snowball. For people who can control themselves financially, the avalanche works better imo

[esm-gh]

this is my first time watching you but am reaslly impressed with your videos

[briankrause]

You know I have to give you props... Not only do you have a very personable presentation style, but you speak plainly/clearly without over complicating anything, so you are always easy to follow.


I'm in my 50s, and am well into being 'set' thankfully, BUT, I still really enjoy your videos as you just seem to legitimately care about what you are doing and it come across as authentic. Given ALL the YT content that is garbage, it is so refreshing to see somebody doing something that seems to be a labour of love, but also helping complete strangers as well.


Big props to you Marko, I really like your stuff and have subscribed. I really think you have a great way of presenting data clearly that speaks to (what I perceive at least as) 'average joes' without talking down to those you are helping. Keep it up.

[MrTeamshellshock]

The white shirt with white background is a good look lmao. keep up the vids crazy how fast much this channel has grown

[chrissystewart]

Thanks for the info as an Entrepreneur I do want to learn on financing, time management & smart goals

[DeparturesCapital]

Great Video Bro!!!! E55 AMG car loan is always the best kind of debt! Lets go baby!

[Rot]

More like, CC 12k, Auto 40k, Student 135k. While making That's a more realistic view on the average person sadly.

[diwang]

I'd definitely use the one that saves me more money. Thank you!

[katiecano]

Thanks! I will be using these spreadsheets

[BachBeethovenBerg]

The other advantage to debt snowball is it frees up minimum payments quicker and so it reduces your risk if something were to happen like you have an unexpected expense or lose your job.

[MindBodyStorm]

⛩️This matches perfectly with the Kaizen approach to goal setting‼️