Debt Snowball vs Avalanche Calculator
Compare debt payoff strategies: snowball (smallest balance first) versus avalanche (highest rate first). See total interest and payoff timeline.
What this calculates
When you have multiple debts and limited extra cash, the order you pay them off in matters. Two famous strategies: snowball (pay smallest balance first, for motivation) and avalanche (pay highest interest rate first, for cost). This calculator runs both against your actual debts and shows the math — how many months until debt-free and how much total interest you'll pay each way.
Formula & how it works
Each month: pay the minimum on every debt, then apply any extra cash to one priority debt (smallest balance for snowball, highest rate for avalanche). Interest accrues monthly at (annual_rate/12) × current_balance. When a debt hits zero, its former minimum payment 'rolls' into the next priority debt — the snowball grows. Repeat until all balances are zero. Avalanche always wins on total interest; snowball usually wins on staying motivated.
Worked example
Three debts: Credit Card A ($2,000 @ 22 %, min $50), Card B ($5,000 @ 18 %, min $125), Auto Loan ($12,000 @ 6 %, min $230). Extra $200/month available. Snowball pays Card A first (smallest), then B, then auto. Avalanche pays Card A first too (highest 22 %), then B (18 %), then auto (6 %). They match here — but if Card A were $20,000 instead, avalanche would still target A first while snowball would tackle Card B first. Avalanche typically saves $200–$2,000 in interest depending on the debt mix.
Frequently asked questions
Which is better, snowball or avalanche?
Mathematically: avalanche always saves more interest. Behaviorally: snowball gives quick wins that keep people going. Studies show people stick to snowball plans more often. The best plan is the one you actually finish.
Should I include my mortgage?
Usually no. Mortgages have low rates and very long horizons — they shouldn't compete with high-interest credit cards. Some people target the mortgage only after all other debts are gone.
What about 0 % balance transfer cards?
If you can actually pay off the balance before the promo rate ends, transferring high-rate debt to a 0 % card beats both strategies. Watch the transfer fee (typically 3–5 %) and the expiry date — missing it can reset the full rate.
Should I save for emergencies first?
Most financial advisors say yes: build a $1,000 starter emergency fund before aggressive debt payoff, then a full 3–6 month fund afterward. Without it, one unexpected bill often goes onto the same card you're trying to pay down.
Sources
Disclaimer: Informational only — not financial advice. A nonprofit credit counselor can help with severe debt situations.
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