Debt Payoff Calculator: Snowball vs Avalanche
Enter every debt you hold and see what each strategy costs in interest and in months. The comparison is on your numbers, not a generic example.
In short
The avalanche method pays the highest interest rate first and always costs less in total interest. The snowball method pays the smallest balance first and clears individual debts sooner, which sustains motivation. Avalanche wins on arithmetic; snowball wins more often in practice because people stick with it.
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How the two strategies differ
Both methods pay the minimum on every debt, then throw everything left over at one target. When that target clears, its payment rolls into the next one, so the amount going at the remaining debts grows every time one falls. That rolling payment is where the speed comes from, and both methods share it.
The only difference is which debt goes first. Avalanche picks the highest interest rate. Snowball picks the smallest balance.
Why avalanche is cheaper
Interest accrues on a balance at its own rate, so every month a 24% card survives costs you more than a month of a 6% loan surviving. Clearing the expensive debt first removes the fastest-growing charge from the picture soonest, and there is no arrangement of payments that beats it.
That is a mathematical fact, not a judgement about what you should do. The relevant question is how much cheaper, which depends entirely on the spread between your rates and the sizes of the balances.
Why snowball still wins for many people
A repayment plan only works if you finish it, and finishing takes two to five years for most people. Clearing a whole debt is a visible, complete result, and clearing the small one gets you there in months rather than years. It also simplifies your life: one fewer account, one fewer date, one fewer minimum to miss.
Research on actual borrowers has repeatedly found that people who pay the smallest balance first are more likely to stay with the plan. A slightly more expensive method that gets completed beats a cheaper one that gets abandoned in month seven.
So run both, look at the gap, and decide with the real number in front of you. If avalanche saves you forty over three years, take the snowball. If it saves you two thousand, take the arithmetic.
The minimum payment trap
Credit card minimums are usually set at one to three percent of the balance, or a small fixed floor, whichever is higher. This is deliberately close to the interest charge, which is why balances barely move.
A 3,000 balance at 22% with a 2% minimum takes over twenty years to clear and costs more in interest than you originally borrowed. Worse, the minimum falls as the balance falls, so the plan stretches out further the closer you get.
Fixing your payment at today's minimum rather than letting it drift down is one of the cheapest changes available. It costs nothing extra this month and cuts years off the end.
Things that beat both strategies
- A lower rate. A zero percent balance transfer, a credit union loan or a rate reduction you simply asked for changes the arithmetic more than any ordering does. Ask. Retention teams often say yes.
- An employer pension match. A 100% match is a bigger instant return than clearing a 22% card. Take the match, then attack the debt.
- Stopping the additions. No repayment order helps if the balance is still growing. The first step is usually to freeze the account rather than to optimise the schedule.
- Priority debts. Rent, mortgage, council tax, utilities and anything secured on your home come first regardless of interest rate, because the consequence of missing them is not financial.
What this calculator assumes
Rates stay fixed, you add no new borrowing, payments arrive on time and interest is charged monthly on the outstanding balance. Real cards compound daily and charge fees, so treat the totals as close estimates rather than statements.
If your budget does not cover the combined minimums, the calculation cannot run, and that is the genuinely important output. At that point the answer is not a repayment strategy; it is free debt advice from a charity such as StepChange or National Debtline, who negotiate with creditors on your behalf and charge nothing.
Frequently asked questions
Which is better, snowball or avalanche?
Avalanche always costs less. It pays the highest interest rate first, so the most expensive debt stops growing soonest. Snowball pays the smallest balance first, which costs more in interest but clears whole debts faster. If the difference between them is small, take the one you will actually finish.
How much does the difference usually come to?
For most people it is tens or low hundreds, not thousands, because the highest rate and the smallest balance are often the same debt. The calculator shows your actual gap rather than a generic claim, and if it comes out under a hundred the choice is really about motivation.
What is the minimum payment doing to me?
Card minimums are typically one to three percent of the balance, set so that most of the payment covers interest. Paying only the minimum on a 3,000 balance at 22% takes over twenty years and costs more in interest than the original debt. Any amount above the minimum goes almost entirely to principal.
Should I consolidate instead?
Consolidation helps if the new rate is genuinely lower and you do not re-borrow on the cleared cards. It is a refinancing, not a repayment. A zero percent balance transfer is worth the fee if you can clear it inside the promotional period; if you cannot, the reversion rate is often worse than what you left.
Should I save or pay off debt first?
Keep a small buffer, perhaps one month of essentials, then attack the debt. Beyond that buffer, paying off a 22% card is a guaranteed 22% return, which no savings account will match. The exception is an employer pension match, which is usually worth taking first.