Debt Avalanche Calculator
List every debt you have. We'll tell you exactly which one to attack first, how long the payoff takes, and how much interest you'll save versus the minimum-payment path.
Your Debts
Avalanche vs. Snowball: What's the Difference?
Two dominant methods exist for paying off multiple debts. The avalanche method (used by this calculator) attacks the highest interest rate first, then works down. This is mathematically optimal — you pay the least total interest and finish fastest.
The snowball method attacks the smallest balance first regardless of interest rate. It's psychologically easier because you see debts disappear quickly, but it costs more in total interest.
How Avalanche Works
The method has three steps:
- Pay the minimum on every debt to avoid late fees and credit damage.
- Put every spare dollar toward the debt with the highest APR.
- Once that debt is gone, roll its entire payment into the next-highest-rate debt. That's where the "avalanche" effect kicks in — the amount you throw at debt #2 is much larger than what you were originally paying.
What Counts as Extra Budget?
The budget field is the total you'll pay across all debts each month. If your minimum payments across all debts add up to $500, and you can put $300 more toward debt, enter $800 as your budget. The calculator distributes minimums first, then sends everything else to the highest-rate debt.
Debt Payoff Worksheet
Printable worksheet to track every payment. One page. Stick it on your fridge.
Frequently Asked Questions
Is the avalanche or snowball method better?
Avalanche saves more money mathematically (always). Snowball has higher completion rates in behavioral studies because small wins keep people motivated. Best choice depends on you: if you're analytical and disciplined, avalanche. If you've quit debt plans before, snowball.
Should I pay off debt or save for emergencies first?
Build a small starter emergency fund first ($1,000-$2,000), then attack high-interest debt aggressively, then build a full 3-6 month emergency fund. Attacking debt without any emergency cushion means any minor crisis (car repair, medical bill) puts you right back into debt.
What interest rate is "high" enough to avalanche first?
Anything above 8-10% should be attacked aggressively. Credit cards (typically 18-29% APR) are always first priority. Mortgages below 5% generally shouldn't be prioritized over investing. The gray zone is 5-8% — depends on your risk tolerance and tax situation.
Does paying off debt improve my credit score?
Usually yes, but with nuance. Paying down credit card balances improves your utilization ratio quickly (often 20-50 point jump). Paying off installment loans like auto or student loans has smaller, slower impact. Closing paid-off credit cards can actually hurt your score by shortening credit history — consider keeping them open with zero balance.