How to Pay Off Debt Faster

Having a plan to pay off debt is one of the best financial moves you can make. Even modest extra payments, applied consistently over time, can save hundreds or thousands of dollars in interest and get you debt-free years ahead of schedule.

There are two main strategies for paying off debt: the debt avalanche and the debt snowball. Both can work—the difference is how you prioritize your debts and what the experience of paying them off feels like along the way.

Get a clear picture of what you owe

Before you pick a strategy, gather the details on every debt you’re carrying. For each account, write down the balance, the interest rate and the minimum monthly payment. This becomes your working list.

Once you have it, calculate how much you can realistically put toward debt each month beyond the minimums. Even $50 to $100 extra per month could make a meaningful difference compounded over time.

The debt avalanche method

The avalanche method prioritizes your highest-interest debt first. Here’s how it works:

• Make the minimum payment on every account each month.
• Direct all extra money toward the account with the highest APR.
• When that debt is paid off, roll its entire payment toward the next highest-rate account.
• Continue until all debts are paid.

The avalanche is mathematically optimal. By attacking the highest-rate debt first, you reduce the total interest you pay over the life of your debts. For people carrying high-rate credit card balances alongside lower-rate loans, the savings can be substantial.

There is a trade-off though. If your highest-rate debt also has a large balance, it can take a long time before your balance hits zero. You’ll be putting a lot of effort into paying off your debt, and for a while you won’t see much of a result. That can feel discouraging, even if it’s worth it.

The debt snowball method

The snowball method prioritizes your smallest balance first, regardless of interest rate:

• Make the minimum payment on every account each month.
• Direct all extra money toward the account with the smallest balance.
• When that debt is paid off, roll its payment toward the next smallest balance.
• Continue until all debts are paid.

The snowball generates quick wins. Paying off a small debt entirely—even if it wasn’t your highest-rate account—creates real momentum and a sense of progress that many people find motivating.

Research supports this: a study published in the Journal of Consumer Research found that focusing on paying off individual accounts (rather than spreading payments across all accounts) lead many people to pay off their debt more aggressively—especially when they started with smaller balances.

There is a downside to this method, though: you will likely pay more in total interest compared to the avalanche method, depending on your specific balances and rates.

Avalanche vs. snowball: which should you choose?

You can pay down debt either way, so the best strategy is the one you’ll stick with.

If you’re motivated by numbers and can stay disciplined even when progress feels slow, the avalanche will save you the most money. If you need to see accounts getting closed off to stay motivated, the snowball will keep you moving.

Some people even combine them: start with the snowball to build momentum by knocking out a small balance or two, then switch to the avalanche for the remaining larger debts.

Making it work: practical tips

Automate your extra payment

Set up an automatic extra payment to your target account each month. Treat it like a bill. Taking the decision out of your hands each month removes the temptation to skip it.

Use windfalls to pay debt

Tax refunds, bonuses, birthday cash and other unexpected money are opportunities. Applying even a portion directly to your debt can accelerate your timeline significantly.

Avoid adding new debt

Both strategies assume you’re not adding to the pile while paying it down. If you’re continuing to carry new balances on the same credit cards you’re paying off, progress stalls. Consider setting those cards aside temporarily while you work on the balances.

Track your progress

Watching balances drop is motivating. Keep a simple spreadsheet or use a digital budgeting tool to track where you are each month. Seeing the trajectory helps on days when progress feels slow.

What if I can’t afford extra payments right now?

Both strategies require some money beyond minimum payments to work well. If your budget is too tight for extras right now, that’s a signal to look at your spending first.

A budget review often surfaces expenses that can be redirected. Even $25 to $50 a month applied consistently starts to move the needle. If your situation is more constrained than that, look into income-driven repayment options for student loans, hardship programs offered by credit card companies or nonprofit credit counseling for a structured plan.

Ready to make a plan?

Horizon members can access free financial counseling through GreenPath Financial Wellness, an independent third-party organization. The team at GreenPath can help you think through your debt and build a payoff strategy that fits your situation. If you’re struggling with debt, don’t delay—schedule a session with Greenpath today.

This information is provided for general educational purposes and is not intended as financial, tax, legal or investment advice. Individual circumstances vary. Consult a qualified professional regarding your specific financial situation before making financial decisions.