If you have more than one debt—salary advance, personal loan, hire purchase, or credit card—it’s easy to feel stuck. Minimum payments keep you “current,” but they don’t always get you free.
You don’t need a complicated spreadsheet to start. You need a method you can follow every month.
Two popular strategies are the Debt Snowball and the Debt Avalanche. Both work. They just prioritise different things.
In Nigeria, it’s not unusual to mix different types of debt at the same time: salary advances, app loans, hire purchase instalments, or even short-term borrowing to cover bills when prices rise. If that’s your situation, the goal here is simple: pick a payoff method you can stick with, then make steady progress every month.
Quick Definitions
Debt Snowball (motivation-first)
You pay off the smallest balance first.
- Pay minimums on all debts.
- Put any extra money toward the smallest balance.
- When that debt is cleared, roll that payment into the next smallest debt.
This method is great if you need early wins to stay consistent.
Debt Avalanche (cost-first)
You pay off the highest interest rate first.
- Pay minimums on all debts.
- Put any extra money toward the highest-rate debt.
- When it’s cleared, move to the next highest-rate debt.
This method usually saves more money in total interest.
Which One Is Better?
The best method is the one you can keep doing for the next 6–24 months.
- Choose Snowball if you feel overwhelmed and need quick progress.
- Choose Avalanche if you’re disciplined and want the lowest total cost.
Build Your Payoff Plan (Step-by-Step)
Step 1: List your debts
For each debt, write down:
- Current balance
- Interest rate (or the lender’s monthly charge)
- Minimum monthly payment
Step 2: Pick your target
- Snowball target: smallest balance
- Avalanche target: highest interest rate
Step 3: Decide your monthly “extra payment”
This is what you can pay on top of minimums each month.
If you’re not sure what’s realistic, start with a simple budget:
- Budget Calculator — quickly split your income and find room for extra payments.
Step 4: Understand the real cost of each loan
Many people focus on “how much per month” and miss “how much is interest.”
- Loan Calculator — estimate monthly payments and view an amortisation schedule.
Simple Example
Imagine you have three debts:
- Debt A: ₦50,000 balance, medium interest
- Debt B: ₦400,000 balance, low interest
- Debt C: ₦150,000 balance, high interest
With Snowball, you’d attack Debt A first for a quick win. With Avalanche, you’d attack Debt C first to reduce interest faster.
Tips That Make Either Method Work Better
- Pay yourself first: automate your extra payment right after payday.
- Avoid new debt during payoff—especially “small” buy-now-pay-later purchases.
- Cut temporarily, not forever: even 3–6 months of tighter spending can speed things up.
- Recalculate after each payoff: when one debt is gone, your extra payment grows.
Bottom Line
Debt snowball and debt avalanche are both proven. Choose the one that matches how you actually behave—and start today.
- Find your extra payment with Budget Calculator.
- Check the true cost of your debts with Loan Calculator.
Written by Calc Labo Research Team