When you owe on several debts, the order you pay them off changes both how fast you finish and how much interest you pay. The two most popular strategies are the debt snowball (smallest balance first) and the debt avalanche (highest interest rate first). This calculator runs both on your actual debts so you can pick with real numbers.
How this calculator works
You enter each debt's balance, interest rate and minimum payment, plus how much extra you can pay each month. Your total monthly budget is the sum of all minimums plus the extra amount, and it stays constant.
Each month, interest is added to every balance and the minimum is paid on every debt. All remaining budget goes to one target debt: the smallest balance (snowball) or the highest rate (avalanche).
When a debt is paid off, its minimum payment rolls into the next target — that is the snowball effect, and both methods use it. The calculator repeats until everything is paid and reports time and interest for each method.
The formula
Monthly budget = Σ minimums + extra; Interestᵢ = Balanceᵢ × (APRᵢ ÷ 12)- Σ minimums
- sum of all minimum payments
- extra
- additional amount you commit each month
- Snowball target
- debt with the smallest balance
- Avalanche target
- debt with the highest APR
Worked example
Using the defaults: a $4,500 credit card at 24%, a $9,000 car loan at 7% and a $1,800 store card at 18%, with $450 in combined minimums and $300 extra — a $750 monthly budget.
Snowball attacks the $1,800 store card first, clearing it in a few months for a quick win, then the credit card, then the car loan. Avalanche targets the 24% credit card first, then the store card, then the car loan.
Both finish in roughly two years, but avalanche pays less interest because the most expensive balance shrinks first. With these numbers the gap is modest; it grows when rates differ sharply or balances are large.
Tips
- Avalanche is mathematically cheapest. Snowball can be easier to stick with because early wins build momentum.
- Stop adding new charges to cards you are paying down.
- Consider a 0% balance transfer or a lower-rate consolidation loan if your credit qualifies.
Frequently asked questions
Which is better, debt snowball or debt avalanche?
The avalanche method always costs the same or less in interest. The snowball method can be more motivating. The best method is the one you will keep following — and the difference is often smaller than people expect.
How does the debt snowball method work?
List debts from smallest to largest balance. Pay minimums on all of them and put every extra dollar toward the smallest. When it is gone, add its payment to the next smallest, and repeat.
How does the debt avalanche method work?
List debts from highest to lowest interest rate. Pay minimums on all and send extra money to the highest-rate debt. When it is paid off, roll that payment into the next highest rate.
Should I include my mortgage in a debt payoff plan?
Most people leave the mortgage out because it is large, low-rate and long-term. Focus on consumer debts first, then decide separately whether to prepay the mortgage.