Compare two ways to pay off multiple debts: target the smallest balance first with the snowball method, or the highest APR first with the avalanche method.
Enter comma-separated balances, APRs and minimum payments in matching order.
The model applies estimated monthly interest to each opening balance and pays each active debt's entered minimum.
It allocates the remaining extra budget to the selected strategy's target, then rolls any excess to the next debt.
When a debt is paid off, its unused minimum payment is added to the next month's available extra budget.
The two schedules are simulated until all balances are cleared, a schedule stops reducing debt, or the estimate reaches 100 years.
Monthly interest for each debt: Opening balance × APR ÷ 12 ÷ 100
Payment budget: Sum of minimum payments + extra monthly budget
Snowball target: Active debt with the smallest balance
Avalanche target: Active debt with the highest APR
The debt payoff strategy calculator compares two repayment orders for several balances. The snowball method directs extra money to the smallest balance first. The avalanche method directs it to the debt with the highest annual percentage rate (APR) first. Both schedules pay the listed minimum on every active debt, then apply the same extra monthly budget to the chosen target.
The comparison is most useful when you already know the balances, APRs and required monthly minimums for your accounts. Enter each list in the same order: the first balance must match the first APR and first minimum payment. When one debt clears, its unused minimum payment is added to the next target, so the total monthly budget can continue working against the remaining debt.
This is a simplified monthly model, not a lender payoff quote. It applies APR divided by 12 to each opening balance, assumes the minimum payments and extra budget stay fixed, and excludes new charges, fees, rate changes and payment-date effects. Use the result to understand the effect of repayment order, then check your statements for actual amounts.
1. Enter the outstanding balances, annual APRs and monthly minimum payments as comma-separated lists of equal length.
2. For each debt, calculate monthly interest as opening balance × APR ÷ 12 ÷ 100.
3. Apply each active debt's minimum payment, capped at the amount due for that month.
4. Add the extra monthly budget and any minimum payment amount freed by a debt that has already cleared.
5. For snowball, sort active debts by smallest balance. For avalanche, sort by highest APR.
6. Apply the available extra amount in the selected order, rolling any remainder to the next debt.
7. Repeat each monthly schedule until every balance is cleared, no debt is being reduced, or 1,200 months have elapsed.
Snowball sorts debts by their current balance, smallest first, and sends the extra budget to the first active debt after minimums are covered. Once that debt is paid, its former minimum payment is no longer needed there and becomes part of the amount available for the remaining targets. A small balance can therefore disappear early, giving a clear milestone and reducing the number of accounts. This method does not sort by interest rate, so a high-rate debt can remain outstanding while a lower-rate balance is cleared.
Avalanche sorts active debts by APR, highest first, and directs extra payments to the most expensive rate. Since interest is estimated separately for each balance, reducing a high-rate balance earlier usually lowers the next month's interest more than reducing a same-sized balance at a lower rate. With the same minimum payments and total budget, this order often costs less interest. The exact difference depends on the amounts, rates and minimums entered, and it can be small when rates are similar.
Both strategies in this calculator use the same monthly minimum payments and extra budget. The model treats minimums as fixed currency amounts, even though real card minimums may change as balances fall. When a debt is cleared, its unused minimum is rolled forward, preserving the repayment budget instead of reducing the total amount paid each month. No new borrowing, fees, rate resets or daily-interest calculations are included, so the actual payoff can differ.
Arun has two debts and wants to compare paying the smaller balance first with targeting the higher APR.
Starting debt: Sum of the entered balances
Monthly interest: Each opening balance × its APR ÷ 12 ÷ 100
Minimum payments: Paid to each active debt before allocating extra money
Snowball order: Extra budget goes to the smallest balance first
Avalanche order: Extra budget goes to the highest APR first
Interest difference (snowball − avalanche): Total snowball interest − total avalanche interest
Answer: Snowball payoff time 11 months; Snowball interest ₹10,107; Avalanche payoff time 10 months
Entering balances, APRs and minimums in different orders.
Entering a monthly rate where the calculator expects an annual APR.
Comparing methods with different monthly budgets rather than the same minimums and extra amount.
Assuming the entered minimum stays fixed on a real credit card when the issuer recalculates it.
Continuing to use an old balance or APR after a payment or rate change.
Choosing whether to prioritize a small balance or a high-rate balance.
Estimating how much total interest a repayment order may accrue.
Planning how to roll payments forward after an account is cleared.
Checking whether current minimums and extra budget reduce all balances.
Which method usually costs less interest?
The avalanche method generally targets the highest APR first and often minimizes interest when rates, minimums and payment budget stay fixed. Actual results depend on your inputs, and this estimate excludes fees and rate changes.
Why might someone choose the snowball method?
Paying off a small balance early can create visible progress and simplify the number of accounts to manage. That motivational benefit may help some people stick to a plan, even if the avalanche method estimates less interest.
Can I use this for credit cards and loans together?
Yes, if you enter each balance, APR and required monthly minimum. The calculation treats every debt as a monthly reducing-balance account and does not model issuer-specific rules.
Does this guarantee the payoff date?
No. It assumes rates and minimum-payment amounts stay fixed, no new borrowing or fees are added, and payments occur monthly. Check lender statements and terms for actual amounts.