Debt Management
Snowball vs. Avalanche: How to Actually Set This Up as Real Numbers
By Nasim Farhan, Founder, Expentify · May 22, 2026 · 7 min read
Most explanations of these two methods stop at the definition. Here's a worked example with three specific debts and real numbers, plus how to track it as separate liability accounts instead of one lump "debt" figure.
You've probably seen the definitions before: snowball pays smallest balance first for motivation, avalanche pays highest interest rate first to save money. What's usually missing is what those two orderings actually look like with real numbers, because that's where the two methods can genuinely disagree about what to do first.
Three debts, one real example
Say you have three balances and $300/month above the minimums to put toward one of them:
Card A: $1,200 balance, 19% APR
Card B: $6,000 balance, 24% APR
Personal loan: $9,000 balance, 8% APR
Snowball order (smallest balance first): Card A, then Card B, then the loan. You'd clear Card A fastest — a real, motivating win — but Card B, the largest and highest-rate balance, keeps accruing interest at 24% the whole time you're focused on A.
Avalanche order (highest rate first): Card B, then Card A, then the loan. This tackles the balance that's both large and charging the most interest first, which is where avalanche's real savings comes from in this specific example — it's not automatically true for every combination of balances and rates, it just happens to be true here because Card B is both the biggest and the most expensive.
If Card B had instead been the smallest balance, both methods would agree on where to start — the interesting cases are exactly the ones like this, where size and rate point in different directions.
Tracking this as separate accounts, not one number
The part that actually breaks down for most people isn't picking a method — it's that most budgeting tools only show "total debt" as one lump figure, which makes it impossible to see this kind of tradeoff at all. In Expentify, you can set up each debt as its own liability account (in the setup wizard's "Manage & Add Account Heads" step), so Card A, Card B, and the loan each carry their own running balance. The Trial Balance in the Reports tab (shown in Expert mode) lists all of them side by side, which is what actually lets you see a comparison like the one above with your own real numbers instead of a hypothetical.
To be clear about what the app does and doesn't do here: it won't pick a strategy for you or run an amortization projection. It gives you accurate, separate balances for each debt so you can run this comparison yourself, with your actual numbers instead of a generic example.