What’s the Debt Avalanche Method for Paying Down Debt?

Debt causes stress for millions of people, and working to cover even simple minimum payments can be hard. Paying down big balances or eventually regaining more financial freedom are intimidating goals for many. The stress debt causes can even impact your health.

The best way to get debt-free is to develop and implement specific strategies to prioritize your debt payoff. Ideally, the strategy should focus on tactics that lower payments and help free up more cash.

To reduce credit card debt and student loan debt, financial experts have devised many debt repayment strategies. One method is the debt snowball method. The snowball method means paying off your smallest debt amounts first.

Another repayment strategy is the Debt Avalanche method. Read on to find out how this debt reduction strategy works, who should use it and how it could improve your personal finance and credit habits.

How the Debt Avalanche Method works

The Debt Avalanche method prioritizes debt repayment by addressing debts with the highest interest rate first. With this method, you focus on making extra payments or making a regular monthly payment that’s greater than the minimum amount due. Either method encourages you to put a portion of any extra cash – like tax…