How to Stay Motivated When Using The Debt Avalanche

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debt avalanche

Just yesterday, Cat asked a question to see if paying down your smallest debt first might be ridiculous. Now, she isn’t really calling it this, but it was a provocative question. The reason being, is this method is touted by Dave Ramsey. It’s called the debt snowball.

I’m very familiar with this method and its process is all over the internet. You can find information on the debt snowball with one simple Google search. Now, I don’t think any debt repayment method is ridiculous. Any way someone wants to pay down debt is fine with me.

Many people succeed with the debt snowball method. I think this is why it’s popular. You see so many people using it and getting out of debt. That’s a good feeling for sure.

When I was in over $50,000 of debt, I looked at many different ways to pay down my debt. I looked at both the debt snowball and debt avalanche as the best ways to rid myself of debt. The ultimate decision for me was the ability to save thousands in interest over the course of my repayment. This is why I chose the debt avalanche.

What is the Debt Avalanche Approach?


For those who aren’t aware, the debt avalanche approach to paying off debt is where you list your debts from highest interest rate to the lowest. When you start paying down your debt, you focus on the highest interest rate. You pay the minimum payment toward all your debts, but put any extra money on the highest rate debt. Once you pay off the first debt, you go to the next highest rate and use what you paid toward the first debt and add it to the minimum payment of the second. This process continues until your debt is paid off.

This method is touted as a way to pay the least amount of interest. This is really the case when you have debt with a wide degree of interest rates. For example, my debt ranged from 0% to 19.99% APR. That’s a huge difference. Though the 0% debt was the smallest balance, I saved more money tackling the 19.99% rate first.

Where the Debt Avalanche Fails


The number one reason people fail using this method is due to the lack of motivation. Motivation is a huge factor in attacking debt. Staying motivated is really the only way you can succeed. This is where the snowball method is successful.

When someone pays off a small balance, they feel motivated to keep going. When you are paying off large amounts of debt, it takes some time. As Cat noted, you can get some debt fatigue. You get tired of making payments without seeing much progress toward the goal. I get it, trust me! It took me four years to pay down my debt.

Make Milestones to Stay Motivated With the Avalanche Method


As I noted, I used the debt avalanche method to much success. I saved nearly $2,000 in interest I would have paid if I used the debt snowball approach. Now, this is just my case, but I know many in the same scenario. The avalanche method makes mathematical sense for many with credit card debt. The problem is the lack of motivation to finish.

To stay motivated, you need to create milestones for your repayment process. With the snowball method, your milestones are when a debt is paid off. That’s an incredibly motivating factor. With the avalanche, you might not get that same motivation.

When I was in the process, I created achievable milestones for each of my debts. For example, my first card had nearly $10,000 on it. It was going to take me some time to pay it off. It actually took me a year to pay off that first card. Especially when you have larger amounts of debt to pay down, keeping track of your finances including spending and debt repayment efforts can be cumbersome; don’t forget to take advantage of tools available like Personal Capital, to make it a little easier.

In order to stay on the ball, I created simple and to the point balance milestones. Every time I paid off $2,000, I would celebrate in some way. Now, I wouldn’t take a trip, but I would do something for myself.

To mark one milestone, I went out to dinner with my wife. We didn’t get to do these little things when in debt, so this was a nice treat. This little milestone was incredibly motivating. In another instance, we would take a weekend and go camping in the mountains. Since I love camping, I would look forward to this and it would keep me going.

Obviously, your milestones will be different from mine. You need to do things important to you, but ones that won’t put you back in debt. I never used my credit card to fund these little trips. Since I was paying off debt and saving at the same time, I would use my savings. It’s the big reason why I enjoyed my debt/saving allocation method so much. It worked and it changed my philosophy on money.

The only way the avalanche method works is if you can create actionable milestones that keep you motivated. Paying off debt is not only about numbers, it’s about mindset and emotion. You have to attack debt on all of these fronts. You can have your cake and eat it too when you use the avalanche method and incorporate achievable milestones throughout. Trust me, why not try to save interest and get your debt paid off?


What do you think about incorporating milestones into the debt avalanche method? How are you paying off debt? Which approach works best for you? How do you stay motivated within your approach to keep paying down your debt?

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Grayson is the owner of Debt Roundup and iMark Interactive. After going to battle and winning against consumer debt, he decided it was time to learn how to use credit wisely and grow his wealth. He discusses all things personal finance and is not afraid of being controversial.


  • Petrish @ Debt Free Martini says:

    I love David Ramsey, but I always believe that people should attack their high interest debt first. I do get the concept of the snowball effect, but it is very possible to lose money while utilizing this method.

  • Catherine says:

    I get enjoyment out if simply logging into our (debt) accounts and seeing the balance decrease…It’s enough to keep me going!

  • Holly@ClubThrifty says:

    When we paid off debt years ago, we hit the smallest balances first. We were all about the psychological victories!
    I don’t think either strategy is bad. As long as you are killing debt, it doesn’t matter.

  • Jon @ Money Smart Guides says:

    I think having milestones is huge to keep your motivation up. I tried the avalanche method when I was first trying to get out of debt but failed with it. I ended up using the snowball method.

    Had I used milestones and was getting out of debt for the right reasons (at the time I wasn’t) I think I could make the avalanche method work.

    At the end of the day though, you have to know yourself and pick the method that is most likely going to help you succeed. Both work, it’s all a matter of preference.

  • Laurie @thefrugalfarmer says:

    Love the way you put this, Grayson. We had been using the avalanche, but it just wasn’t working, I think, b/c of our large debt balances. We just kept feeling like we weren’t getting anywhere, and we weren’t, in a way, for a lot of reasons. We started the snowball in December, and so far it’s working really well for us. Because we’re concentrating on the smallest debt first, I feel like it’s giving us the faith to believe for bigger things the next go around with the next biggest card. I’m not a big believer in letting emotions rule, but I think we need to dump debt this way b/c of our big debt load and the stress it’s created on us.

  • Tonya@Budget and the Beach says:

    If I have different kinds of debt I would use this method over the snowball method. I just hate seeing more money being accumulated with interest.

  • Brian @ Debt Discipline says:

    We used the snowball method because we wanted the momentum of the victories along the way. As long as your are accomplishing the goal of cleaning up the debt you can you any method you like. 🙂 It’s all about what works best for your personal situation.

  • Kim@Eyesonthedollar says:

    We were more snowballers, but it worked out that the smallest debts also had the highest interest rates. Whatever way keeps your motivation is the right way. It is so so much harder to get out of debt that it is to get into it.

  • Brian @ Luke1428 says:

    Milestones are huge! Without them a person could definitely suffer from debt payoff fatigue. Reaching the point where you can say “Yes, I’ve had a small victory!” will supply the energy needed to propel yourself forward to the next debt.

  • DC @ Young Adult Money says:

    I don’t plan on doing the debt avalanche approach, but I think for those who do it milestones are a great way to stay motivated. That’s one reason I think tackling smaller amounts of debt first is the best (psychological) way to tackle debt.

  • Shannon @ The Heavy Purse says:

    Like you, I’m just happy when people want to tackle the their debt and do. Generally speaking, I’m a bigger fan of debt avalanche plan for the reasons you mentioned. However, from a psychological standpoint, snowball may be the right way to initially start, especially if you’re feeling overwhelmed. Once you pay off one debt, you realize you can do it and may now be ready to switch to the debt avalanche system with the remaining debt. It’s a personal choice and ultimately both can help you eliminate debt, which is what matters most.

  • Kalie says:

    I think incorporating milestone rewards is a good idea. We haven’t consciously done this, but we do go out about once a month for an evening without the kids, and this could be considered a reward for the extra we’re paying down the mortgage each month. Our friends get Indian take-out every time they save X amount toward paying off the mortgage, which is a fun tradition for them.

  • dojo says:

    I would probably attack the highest interest rate myself, since I love Math and would hate to ‘lose’ money, but we do talk something that’s VERY personal (debt) and people do react differently. In my opinion people should use whatever strategy they love more, if it helps them get more focused. No strategy is ‘dumb’, as long as it takes you to being debt free.

    • Grayson Bell says:

      I certainly agree, but many talk about motivation and you can have motivation in either method. It just depends on how you react to it.

  • Kayla @ Everything Finance says:

    I’m doing kind of a hybrid between the two so I can save some money on interest, but also get the motivation from paying off a couple of smaller loan balances quickly too.

  • Luke says:

    The idea that the Debt Avalanche method lacks motivation while the low-balance-first method is full of motivation is not substantiated by any study, and anecdotal reports are full of survivorship bias. There’s nothing inherently less motivating about prioritizing the low interest rate debts, and most of those time the timing of the milestones aren’t that much different. One can’t say with a straight face that someone who can’t remain motivated to pay off the first debt in nine months will be motivated to pay off that first debt in eight and a half months. I’ve written about this extensively throughout the years and coined the “debt avalanche” phrase. There are many more psychological attributes that show the avalanche is better in the long run, it’s not just numbers and logic vs. emotion.

    • Grayson Bell says:

      Interesting comment Luke. I think the reason why we speak about emotion is that paying off debt and money in general is highly emotional. I have spoken with many who didn’t pay off much debt with the avalanche, but did with the snowball. I don’t know how you can correlate them, but this is to show that you can in fact create motivational milestones with the avalanche and succeed with it. I’m a fan of the method and used it myself.

  • Steve MoneyPlanSOS Stewart says:

    I don’t care what anybody says: You need motivation to pay off debt. Pick whatever debt elimination plan you want – the key is to STICK TO IT.

    Whether you pay less interest one way vs getting it over with sooner another won’t matter if you quit – then it just becomes another failed diet you can commiserate about with your friends while eating pizza and chips. 🙂

  • Michelle says:

    Sometimes I like to get creative and make colorful charts that I can write on with a marker, and erase the balance.

  • Rae says:

    I started out with the snowball but switched to the avalanche when I decided I hated the big bank that was killing me slowly with their 29.99% interest rate…thank you for this article, it helps a lot.

  • Tim says:

    I’ve been working through my debt for over a year now using both methods and it is working for me. I started with snowball and attacked all of the really tiny bills first (under 1k balance) then i switch to avalanche and worked through my credit cards. After paying off a couple high interest cards i switched back to snowball for one that i could pay off in 3 months to keep my motivation up and then went back to avalanche.

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