Enter Your Debts

Debt 1

$
%
$

Amount above your total minimums to throw at debt each month

$ /mo
Model Assumptions
  • Fixed APRs (no variable-rate adjustments)
  • Fixed minimum payments (no percentage-of-balance recalculation)
  • No fees, penalties, or late charges
  • No new charges added during payoff
  • Extra payment applied to one priority debt at a time
  • Interest compounded monthly (Balance × APR/12)
  • Priority order fixed at start (not re-sorted monthly)
  • Calculations rounded to nearest cent each month
  • For educational purposes only — not financial advice
Ryan O'Connell, CFA
Calculator by Ryan O'Connell, CFA

Debt Summary

Total Debt --
Total Minimum Payments --

Avalanche vs Snowball Comparison

Avalanche

Highest APR first

Months to Payoff --
Total Interest --
Total Cost --
First Debt Eliminated --

Snowball

Lowest balance first

Months to Payoff --
Total Interest --
Total Cost --
First Debt Eliminated --
Interest Savings (Avalanche) --
Time Savings (Avalanche) --

Balance Over Time

Debt Payoff Timeline (Avalanche)

Understanding Debt Payoff Strategies

Video Explanation

Video: Debt Payoff Strategies Explained

Avalanche vs Snowball: Which Should You Choose?

The two most popular debt repayment strategies are the avalanche method and the snowball method. Both use the same total monthly payment but differ in how they prioritize which debt to attack first.

Avalanche Method

Pay highest APR first.
Minimizes total interest paid. Best for those who are disciplined and motivated by saving money.

Snowball Method

Pay smallest balance first.
Eliminates individual debts fastest. Best for those who need psychological wins to stay motivated.

How the Payment Cascade Works

Both methods share a powerful accelerating mechanism: when you pay off one debt, the minimum payment you were making on it becomes available. This freed-up payment is added to your extra payment and directed at the next priority debt, creating a growing cascade of payments.

Monthly Payment Pool
Available Payment = Extra Payment + Sum of Freed Minimums
As debts are eliminated, the payment pool grows automatically

Warning Signs of Excessive Debt

If you find yourself only paying minimum balances, using savings for routine bills, frequently taking cash advances, or not knowing your total debt amount, these may be signs that your debt load requires attention. A structured payoff plan using either the avalanche or snowball method can help you regain control.

Tip: A common guideline is to keep total debt payments (excluding mortgage) below 20% of your after-tax income. Use this calculator to experiment with different extra payment amounts and see the impact on your payoff timeline.

Frequently Asked Questions

The avalanche method prioritizes debts with the highest interest rate, directing all extra payments to the most expensive debt first. This minimizes total interest paid. The snowball method prioritizes debts with the smallest balance, paying off the smallest debt first to build momentum through quick wins. While the avalanche method typically saves more money, the snowball method can provide psychological motivation by eliminating individual debts faster.

The avalanche method (highest interest rate first) almost always saves the most money in total interest paid. By targeting high-rate debts first, you reduce the amount of interest that accrues each month. The difference can range from negligible to thousands of dollars depending on the spread of interest rates across your debts. However, the snowball method may be preferable if you need the psychological boost of quick wins to stay motivated.

When you pay off a debt using either method, the minimum payment that was going to that debt becomes available. This freed-up payment is added to your extra payment amount and redirected to the next priority debt. For example, if you were paying $150/mo minimum on a credit card and it gets paid off, that $150 is now added to your extra payment pool. This creates an accelerating cascade of payments that grows larger as each debt is eliminated.

If your minimum payment is less than the monthly interest charge (Balance × APR ÷ 12), your debt balance will grow each month — this is called negative amortization. The calculator will flag this with a warning. In this situation, you should either increase your payment amount or contact your lender to discuss options such as rate reduction or payment restructuring.

Include all consumer debts you want to pay off — credit cards, personal loans, student loans, auto loans, and medical debt. You may choose to exclude your mortgage, as it typically has a much longer term and lower interest rate. The calculator handles up to 5 debts simultaneously. For a single credit card, use our dedicated Credit Card Payoff Calculator for a more focused analysis. For detailed amortization schedules, see the Loan Amortization Calculator.

Any amount above your total minimum payments accelerates debt payoff. A common rule of thumb is to keep total debt payments (excluding mortgage) below 20% of your after-tax income. Use this calculator to experiment with different extra payment amounts and see how they affect your payoff timeline and total interest paid. Even an extra $50 or $100 per month can make a meaningful difference over time.
Disclaimer

This calculator is for educational purposes only. It assumes fixed interest rates, fixed minimum payments, and no additional charges. Actual debt payoff may vary based on variable rates, payment changes, fees, and lender policies. For personalized debt repayment advice, consult a qualified financial professional (CFP). This tool should not be used as a substitute for professional financial advice.

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