How to use this calculator
- Fill in the balance, rate and minimum payment fields for Debt 1 to Debt 4: balance, rate and minimum payment (leave unused debts at 0).
- Enter the Extra payment per month you can add on top of all minimums.
- Choose a Method: avalanche (highest rate first) or snowball (smallest balance first).
- Read Debt-free in, Total interest and Interest saved by the extra payment.
How the plan works
Each month interest is added to every balance. You then pay every minimum, and send all remaining money (the extra plus minimums freed from paid-off debts) to one target debt. That total budget stays constant, so as debts disappear their minimums roll into the next one.
Interest each month = Balance × (Annual rate ÷ 12 ÷ 100)- Budget = sum of all minimum payments + extra payment, held fixed every month
- Avalanche target = debt with the highest rate
- Snowball target = debt with the smallest balance
The method decides the target. Avalanche attacks the highest interest rate first and minimizes interest. Snowball attacks the smallest balance first and delivers quick wins.
Example: three debts, $200 extra
Take $4,000 at 24% (minimum $120), $9,000 at 7% (minimum $250) and $1,500 at 18% (minimum $50), total $14,500. With $200 extra and the avalanche method you are debt-free in 27 months and pay $1,868 in interest.
The same plan with snowball also takes 27 months but costs $1,963 in interest, about $95 more. With no extra payment at all, you need 45 months and pay about $4,114, so the extra $200 saves roughly $2,246 and 18 months.
Avalanche or snowball?
Avalanche is never more expensive in interest, so it suits you if the numbers keep you motivated. Snowball can help if you need early wins to keep going; in this example the cost of that was small.
Both beat paying minimums only. If your rates are high on card balances, check balance transfer and debt consolidation options, and see the single-card view in the credit card payoff calculator.
Choosing the extra payment
Start with the largest extra amount you can keep up for the whole plan, then test a smaller and larger figure. In the example, the first $200 saves about 18 months; each additional dollar has less dramatic effect once the high-rate card is gone, but it still shortens the plan.
Be realistic. A plan you abandon after three months is worse than a modest one you keep. Build the amount from your budget using the budget calculator, and revisit it when income changes.
Ways to speed it up
- Raise the extra payment even slightly; the effect compounds over many months.
- Direct windfalls such as tax refunds to the target debt.
- Never skip a minimum payment, since late fees and penalty rates erase progress.
- Stop adding new balances on the cards you are paying down.
- Keep a small emergency fund so a surprise bill does not push you back onto credit.
Assumptions and limits
Rates are fixed and treated as simple monthly interest on the balance; no new purchases, late fees, promotional rates or changes in minimum payments are modeled. Real credit card minimums usually shrink as balances fall, which the fixed minimums here do not.
If a minimum does not cover the monthly interest, the balance cannot fall and the tool warns you. For hardship, a nonprofit credit counselor can help negotiate with creditors.
Frequently asked questions
Which is better, snowball or avalanche?
Avalanche costs the least interest. Snowball may suit you better if early wins keep you motivated. In many cases the difference is modest.
Should I pay debt before saving?
Usually build a small emergency fund first, then prioritize high-rate debt, since its interest typically exceeds what savings earn.
What if there are more than four debts?
Group the smallest ones or add them to one entry by combining balances and using a weighted average rate.
Does consolidation help?
Only if the new rate and fees are lower than your current blended cost. Compare it with the APR and total cost, not just the payment.