Pay minimums on all debts, then attack the smallest with every extra dollar

Never miss a minimum payment on any debt; concentrate all discretionary debt payment on the smallest balance until it is gone.

Why it works

Splitting extra payments across multiple debts produces small reductions everywhere, which creates no visible wins and no freed-up minimums. Concentrating extra payments on one debt at a time produces faster payoffs and frees a minimum-payment amount to apply to the next debt — the "snowball" effect. The concentration principle trades the feeling of "making progress everywhere" (which is motivationally weaker) for concrete elimination events (which produce stronger wins).

How to do it

1. Set up auto-pay for all minimum payments so none are missed.
2. Identify any amount above the minimums you can allocate to debt repayment each month.
3. Direct the entire extra amount to the smallest-balance debt, every month, without exception.
4. When that debt reaches zero, add its former minimum to the amount attacking the next smallest debt.

Evidence

Concentration of repayment on a single account is associated with faster payoff completion in observational research on consumer debt. A study of credit card repayment found that concentrated repayment strategies produced faster debt elimination than distributed ones. (observational)

Gathergood et al. found that most people concentrate repayment on the highest-interest card (avalanche-adjacent), not the smallest balance, in their observed data — which complicates the snowball’s behavioral claim. The motivational advantage of the snowball depends on individual response to completion events.

Sources

• Gathergood et al. (2019), how do individuals repay their debt, American Economic Review

Common mistake

Spreading extra payments across all debts "a little bit everywhere" which produces no elimination events and no freed minimums, maximizing the feeling of progress while minimizing actual payoff speed.