Debt Payoff Calculator

Last updated: 2026-10-08

Two famous strategies, one honest comparison. List your debts — balance, APR, minimum payment — add your extra monthly payment, and this calculator simulates both methods month by month: the avalanche (highest rate first) and the snowball (smallest balance first). You get the payoff order, months to debt-free, and total interest for each, plus what minimums-only would have cost you.

How to use this debt payoff calculator

Each debt row: name it anything, then balance ($), APR (%), and minimum payment ($). Three typical debts are pre-filled — edit them or remove and add your own (up to 8).
Extra payment each month ($): everything above the minimums, applied to one target debt. Defaults to $300.
+ Add another debt: adds a row. Remove deletes one (at least one debt stays).

The headline is the avalanche payoff time. Below: both methods' payoff order, months, and interest, the minimums-only baseline, a verdict on which wins, and a warning if any minimum doesn't even cover its monthly interest.

Worked example

Three debts, $300 extra: a $8,000 credit card at 22% ($200 minimum), a $12,000 car loan at 7% ($280 minimum), and a $5,000 personal loan at 11% ($150 minimum).

Avalanche attacks the 22% card first, then the 11% personal loan, then the car: debt-free in 32 months, total interest $3,818.
Snowball kills the $5,000 personal loan first, then the card, then the car: debt-free in 33 months, total interest $4,452.
Minimums only: 54 months and $8,480 in interest.

The avalanche saves $634 and one month versus the snowball — and the $300 extra saves $4,662 versus minimums. The method debate is worth $634; the extra payment is worth $4,662. Fund the extra payment first, then argue about the method.

Which method should you choose?

Run both, then decide with the numbers in front of you — that's what the verdict line is for. As a rule of thumb:

Take the avalanche when the interest gap is large (a 20%+ balance behind small low-rate debts) or when you're the spreadsheet type who stays motivated by watching interest die. The savings are real money.
Take the snowball when you've abandoned payoff plans before, when the interest gap is small (a few hundred dollars), or when you need a win in the next 2–3 months to believe the plan works.
Take the hybrid when the snowball's first kill is quick but the remaining balances are big and high-rate: snowball for momentum, avalanche for the long grind.

And remember the hierarchy: the extra payment matters roughly seven times more than the method in our example ($4,662 vs $634). If choosing a method is delaying the extra payment, you've got it backwards — pick either one today and start.

How the math works

Each month, in order:

Interest accrues on every remaining balance: balance × APR ÷ 12.
Minimums are paid on all debts (never more than what's owed).
The extra payment — plus any minimums freed up by paid-off debts — attacks the single target debt: highest APR for avalanche, smallest balance for snowball.

The monthly budget stays constant the whole way, so every paid-off debt's minimum rolls into the attack — that's the snowball/avalanche engine. Ties break toward the smaller balance (avalanche) or higher APR (snowball). Our methodology page documents the conventions behind every SialTV Money calculator.

Common mistakes and tips

Adding new debt mid-plan. The simulation assumes balances only shrink. One new $2,000 card balance at 22% can erase months of progress — freeze the cards while you pay them.
Paying extra without a target. Extra money spread thinly across all debts earns the average rate; concentrated on the target debt it earns the highest rate. Focus beats fairness.
Ignoring the minimums-don't-cover-interest trap. If a minimum is smaller than one month's interest, that debt grows forever. Raise the payment or call the lender about hardship options.
Cashing out retirement to pay debt. Raiding a 401(k) triggers taxes and penalties and steals decades of compounding. Only the very highest-rate debt can arguably justify it — run both scenarios before touching retirement money.
Closing old cards immediately. Paid off is the victory; closing the account can ding your credit utilization and score. Keep it open, cut it up, or freeze it — your call.
Skipping the small emergency buffer. Without ~$1,000 set aside, the first surprise expense lands right back on the 22% card and the plan restarts. The buffer isn't optimal math; it's insurance for the plan.

Frequently asked questions

What is the debt avalanche method?

Pay minimums on every debt, then throw all extra money at the highest-APR debt first. When it's gone, roll its payment into the next-highest APR. It minimizes total interest mathematically — in our worked example it saves $634 versus the snowball.

What is the debt snowball method?

Pay minimums on everything, then attack the smallest balance first regardless of rate. You get a paid-off debt fastest, which keeps motivation high. It usually costs a little more interest — $634 more in our example — but the quick wins keep many people going.

Which is better: snowball or avalanche?

Avalanche always wins on interest and usually on time; snowball wins on psychology. If you've quit payoff plans before, the snowball's early wins may be worth the extra interest. If you're disciplined and spreadsheet-motivated, take the avalanche's savings.

How much do extra payments really save?

Enormously. Three debts ($25,000 total) at minimums take 54 months and $8,480 in interest; adding $300 a month cuts it to 32 months and $3,818 in interest — $4,662 saved and nearly two years sooner. The extra payment is the highest-return move in the whole plan.

What if my minimum doesn't cover the interest?

Then the balance grows every month no matter what — you're bailing a leaking boat. The calculator warns you when this happens. The fix is paying more than the monthly interest charge on that debt, or negotiating the rate down.

Should I save an emergency fund before attacking debt?

Keep a small buffer (often $1,000 is the starting point people use) so one car repair doesn't go on the credit card at 22%. Beyond that buffer, extra dollars usually do more killing high-APR debt than sitting in savings earning a fraction of the rate.