Debt Payoff Calculator: Avalanche vs. Snowball

How it works

When you owe money on more than one thing, the question isn't just how much to pay — it's which debt to attack first. There are two well-known answers, and this calculator runs both at once so you don't have to guess.

• The avalanche method sends every spare dollar to the debt with the highest interest rate first, while paying the minimum on the rest. Because high-rate debt is the most expensive to carry, this clears your balances for the least total interest — it's the mathematically cheapest path.
• The snowball method sends every spare dollar to the debt with the smallest balance first. You knock out whole debts faster, which gives you quick, motivating wins — even if you pay a little more interest along the way.

Both methods share one rule: you keep paying the same total amount every month. When one debt is cleared, the money you were putting toward it “rolls down” onto the next debt in line, so your payments snowball in size as you go. The only difference is the order.

Under the hood, the math is simple month-by-month bookkeeping. Each month every balance grows by its monthly interest — monthly interest = balance × (APR ÷ 12) — then we subtract your payments. Whatever budget is left after the minimums gets thrown at the priority debt until it hits zero, and we move to the next one. We repeat until everything is paid off, adding up the months and the interest as we go.

Enter each debt's balance, APR, and minimum payment, then add the extra you can afford on top. Paying as a couple? Add every balance you share or want to clear together and use your combined extra payment — Merger is built for two people sharing a life, no joint account required.

A worked example

Say you owe $1,500 on a small personal loan at 8% APR (minimum $50) and $6,000 on a credit card at 24% APR (minimum $120), with an extra $200 a month to put toward debt. Now the two methods split. The avalanche method sends that $200 to the 24% card first — the expensive one — so you pay the least total interest. The snowball method clears the $1,500 loan first instead, wiping out a whole debt in a matter of months for a motivating quick win that keeps many people going — even though it costs a little more interest overall. The cards above show the exact gap for your own numbers. The takeaway, from this tool and the research alike: avalanche is the cheapest on paper, snowball is the easiest to stick with, and the best plan is simply the one you'll actually finish.

Key terms

APR (annual percentage rate)

The yearly interest rate on a debt. We divide it by 12 to get the monthly rate that's added to your balance each month — the higher the APR, the faster the debt grows if you only pay the minimum.

Minimum payment

The smallest amount your lender requires you to pay each month. Paying only minimums keeps you current but stretches the debt out for years; the extra you add on top is what actually shrinks it.

Avalanche method

Paying off your highest-interest debt first while making minimums on the rest. It clears your debts for the lowest total interest — the cheapest strategy on paper.

Snowball method

Paying off your smallest balance first while making minimums on the rest. You eliminate whole debts quickly for fast, motivating wins, usually at a slightly higher interest cost than avalanche.