How to use the debt payoff calculator
The calculator opens with four typical debts: two credit cards, a personal loan and a car loan, with $250 a month to pay on top of the minimums. Replace them with your own.
- List every debt with its current balance, its APR and its minimum monthly payment. All three are on your latest statements. Add or remove rows as needed, and give each debt a name you will recognize.
- Enter the extra payment: the amount you can pay each month beyond all the minimums put together. Be realistic: a plan you can keep up beats an ambitious one you abandon.
- Choose which plan to show in detail. Both methods are always calculated. The switch decides which one fills the main result and the step-by-step table.
The chart compares the total amount you owe over time under the snowball, the avalanche and minimum payments only. The first table shows when each debt is paid off under each approach. The second lists the order to follow and the interest each debt costs on the way.
How the snowball and the avalanche work
Both methods use the same fixed monthly budget, all the minimums plus your extra amount, and follow the same rules each month:
Pay the minimum on every debt
Put everything left of the budget on the target debt
Budget = Σ Minimum payments + Extra payment (fixed until all debts are gone)Snowball target: the smallest remaining balance. Avalanche target: the highest remaining APR. When a debt is paid off, its minimum stays in the budget and rolls over to the next target, and any money left over in that month goes to the next target too.
The rollover is what makes either method work. The budget never shrinks, so each payoff frees money that speeds up the next one. The minimums-only comparison drops this rule: each debt pays its own minimum, and when a debt is gone its payment simply stops.
A worked example
You owe four debts totaling $22,300. Their minimums add up to $715 a month, and you can add $250, so the budget is $965.00 a month.
Avalanche. You attack Credit card A at 24.99% first, then Credit card B, the personal loan and the car loan: Credit card A → Credit card B → Personal loan → Car loan. You are debt-free in 2 years 4 months and pay $4,407.07 in interest.
Snowball. You start with the smallest balance instead: Personal loan → Credit card B → Car loan → Credit card A. You are debt-free in 2 years 5 months and pay $5,390.66 in interest.
The avalanche saves $983.59. The snowball clears its first debt, the personal loan, in month 5. Under the avalanche, the first debt to disappear goes in month 21, and even that is the personal loan, paid off by its own minimum rather than by the plan.
Paying only the minimums, the same debts take 4 years 10 months and cost $9,227.39 in interest. The avalanche saves $4,820.33 of that, and the snowball $3,836.73.
Which method should you choose?
The math is not in doubt. Paying the highest rate first minimizes interest, so the avalanche always costs the same or less than the snowball. The difference depends on how far apart the rates are and how the balances are spread. It can be a few dollars or a few thousand.
The snowball’s advantage is psychological, and it is real for many people. Clearing a whole debt within a few months gives visible proof that the plan works and removes a bill. The avalanche can mean a year or more of chipping away at one large, expensive balance before anything disappears. In the example, that wait is the difference between month 5 and month 21.
A practical way to decide:
- If the avalanche saves a lot, as when one debt has a much higher rate and a large balance, the extra interest is a high price for motivation.
- If the two plans are close, the snowball’s early wins cost little and may be worth having.
- If you have tried and stalled before, the method you will actually stick with is the cheaper one in practice.
Some people mix the two: they clear one or two very small balances first for momentum, then switch to the highest rate. You can test that by reordering your list and comparing the results.
How much the extra payment matters
The extra amount changes the result far more than the choice of method. With the example debts:
| Extra each month | Avalanche: debt-free in | Avalanche interest | Snowball interest |
|---|---|---|---|
| $0 (rollover only) | 3 years 7 months | $8,006.07 | $8,083.12 |
| $100 | 2 years 11 months | $6,028.16 | $6,695.00 |
| $250 | 2 years 4 months | $4,407.07 | $5,390.66 |
| $500 | 1 year 9 months | $3,091.23 | $4,102.41 |
| Minimums only | 4 years 10 months | $9,227.39 | $9,227.39 |
Even with no extra money at all, simply keeping the total payment fixed and rolling each minimum into the next debt saves $1,221.32 and finishes faster than minimums only. Every extra dollar after that compounds the effect. In this example the gap between the two methods also widens as the extra amount grows, because the order matters more when more money is moving.
Getting the plan to work
- Stop adding to the debts. A plan on paper means nothing if the cards are still in use. New charges quietly undo the rollover.
- Keep a small emergency fund. Without one, the first car repair goes back on a card. Many people hold a modest cash buffer before going all-in on the plan.
- Automate the minimums. A missed payment can bring a late fee and a penalty APR that wrecks the numbers. Pay the extra by hand if you like, but never miss a minimum.
- Look for lower rates. A balance-transfer card or a consolidation loan can cut the interest on the most expensive debts. Our debt consolidation calculator shows whether one would pay off once its fees are counted.
What this calculator does not include
- Daily interest and billing dates. Interest is charged monthly at APR ÷ 12. Real cards use the average daily balance, so the figures can differ by a small amount.
- Changing minimums. Credit card minimums usually shrink as the balance falls. The calculator keeps each minimum fixed, which is how the rollover method is normally run and is close to what happens if you keep paying the same amount.
- Promotional rates, fees and rate changes. A 0% period that ends, annual fees, penalty APRs and variable rates are not modeled. Enter the rate you expect to pay for most of the plan.
- Tax effects. Some interest, such as on student loans, may be partly tax-deductible, which slightly lowers its true cost.