Debt Payoff Calculator
Enter your debts below and instantly see your payoff date, total interest, and how much you save with extra payments.
Last updated: April 2026
Payoff strategy
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Avalanche vs Snowball: Which Method Is Right for You?
Both the debt avalanche and debt snowball methods follow the same core principle: pay the minimum on every debt, then throw every spare dollar at one priority debt. Where they differ is in how you choose that priority debt.
The avalanche method targets the debt with the highest annual percentage rate (APR) first. Because high-rate debt compounds the fastest, eliminating it first minimises the total interest you pay. If you have a credit card at 24% and a car loan at 6%, the avalanche method puts every extra dollar onto the credit card. Over time, this approach saves the most money — sometimes thousands of dollars compared to paying minimums only.
The snowball method, popularised by Dave Ramsey, targets the smallest balance first regardless of interest rate. You pay off the little debts quickly, which creates a psychological "win" that many people find motivating. Once a small debt is gone, its freed-up minimum rolls into the next smallest balance — creating momentum, or a snowball effect.
Research suggests that for people who struggle with motivation, the snowball method leads to better real-world outcomes, even though it costs slightly more in interest. The best method is the one you'll actually stick to.
Frequently Asked Questions
- Is the avalanche or snowball method better?
- The avalanche method saves more money. The snowball method is better for motivation. If your debts have similar balances, the difference is small — choose based on your personality.
- Should I pay off debt or build an emergency fund first?
- Build a small starter emergency fund ($500–$1,000) before aggressively paying debt. Without it, an unexpected expense will put you straight back into debt. Once you have that buffer, focus on high-interest debt.
- What happens when a debt is paid off?
- Roll that debt's minimum payment into your next priority debt — this is the cascade effect built into both methods. Our calculator handles this automatically in every scenario.