Debt Payoff Calculator

The debt snowball method has you pay off debts from smallest balance to largest, regardless of interest rate. You make minimum payments on everything, then throw every extra dollar at the smallest balance until it is gone. Then you roll that payment into the next smallest debt. The appeal is motivation: quick wins early keep you going, even if you pay a bit more interest overall.

The debt avalanche method targets debts by interest rate, highest first. You make minimum payments on all of them, then send every extra dollar to the debt with the highest APR until it is cleared. Then you move to the next highest rate. Because you attack the most expensive debt first, avalanche mathematically minimizes the total interest you pay and usually clears everything a little faster than the snowball method.

Neither is universally better, it depends on what keeps you paying. The avalanche method saves the most money because it kills your highest interest debt first, so it wins on pure math. The snowball method costs a little more but delivers fast, motivating wins that help many people stick with the plan. If the interest gap between your debts is small, pick snowball for momentum. If one debt has a much higher rate, avalanche is worth it.

Credit card interest is usually calculated daily. The card takes your APR and divides it by 365 to get a daily rate, then applies it to your balance each day, so interest compounds. This calculator uses a simpler monthly version: it divides your APR by 12 and charges that on the remaining balance each month. Either way, the fix is the same: pay more than the minimum so the balance, and the interest, shrink faster.