Debt Avalanche Calculator
Pay off multiple debts starting with the highest interest rate to save the most money.
Who This Is For
If saving the most money matters to you and you're disciplined enough to stick with a plan even when progress feels slow at first, the avalanche method is the mathematically optimal choice.
Example Scenario
With a $2,000 card at 22% and a $5,000 loan at 8%, plus $200/month extra, the avalanche method targets the 22% card first because of its higher rate.
Compared to the snowball order, avalanche could save you hundreds in total interest, even though the payoff timeline is similar.
How It Works
The Avalanche method prioritizes your highest APR debt first:
- Pay minimums on all debts
- Apply extra payments to the highest APR debt
- When paid off, roll that payment to the next highest APR
- Repeat until debt-free
This method saves the most money on interest charges, making it the mathematically optimal strategy.
Assumptions and Formula
Assumptions used in this model:
- APR, minimum payment, and extra budget are constant.
- No new borrowing is added during payoff.
- Extra dollars always target the current highest APR debt.
Priority formula: sort debts by highest APR first. Each month, pay minimums on all debts and send all extra cash to the highest-rate balance.
How to Interpret Your Results
| Signal | What It Means | Action |
|---|---|---|
| Interest savings gap vs snowball is large | Rate differences are driving cost | Stick with avalanche for max savings |
| First payoff takes longer | Behavioral friction can increase | Set milestone checks every 90 days |
| Timeline barely improves with extra cash | Minimum payments may be too close to interest | Raise extra budget or refinance highest APR debt |
Frequently Asked Questions
Deep Dive Guide
Read the Debt Avalanche strategy guide
Detailed walkthrough for maximizing interest savings.