If you have multiple debts and want to pay them off, you have two main strategies. The avalanche method and the snowball method. Let me break them down and tell you what I think.
The avalanche method says you attack the debt with the highest interest rate first. You pay the minimum on everything else and throw every extra rupee at the costliest loan. Credit cards in India charge 36% to 42% APR. That is brutal. Personal loans run 12% to 18%. So with avalanche, you would wipe out the credit card first, then the personal loan, then anything else. The math is clear. You save the most money this way because you are killing the debt that is growing the fastest.
The snowball method is different. You pay off the smallest balance first, regardless of interest rate. The idea is that you get a quick win. One less bill to worry about. One account closed. That feeling of progress can keep you going. Some people need that. If you have been struggling with debt for a while and feel stuck, the psychological boost of closing a small loan can be real. I get it.
In my opinion, avalanche wins on pure math. Interest does not care about your feelings. A credit card at 40% is eating your money every month. The sooner you kill it, the less you pay overall. So if you can stay motivated without the quick wins, go avalanche. Pay minimums on everything, and put all your surplus toward the highest interest debt. When that is done, move to the next one.
But here is the thing. If you have tried and failed to stick to a repayment plan before, maybe snowball is for you. Some people need to see progress. Closing a small ₹20,000 personal loan might give you the push to keep going on a bigger credit card balance. The extra interest you pay might be worth it if it means you actually finish. Half a plan that you follow beats a perfect plan you quit.
One more point. Credit card debt is the worst. Access to credit is everywhere now. BNPL, credit cards, personal loans. But the cost of unsecured credit is 15% to 18% for personal loans and 36% to 42% for cards. If you have credit card debt, that should be your top priority no matter which method you choose. Do not let it roll. Pay it down as fast as you can.
So my take? I prefer avalanche because math does not lie. But if you know you need the motivation of small wins, use snowball. Either way, pick one, stick to it, and get out of debt. Your future self will thank you.