Debt & Credit
Debt Avalanche Calculator
Target the highest-interest debt first to minimise total interest paid — the mathematically optimal debt payoff strategy.
Avalanche method: Pay minimums on all debts, then direct extra money at the highest interest rate first. Minimises total interest paid.
🔒 All calculations happen instantly in your browser. No data is sent to any server.
How the calculation works
Step 1: Sort debts from highest to lowest interest rate.
Step 2: Pay minimums on all debts every month.
Step 3: Direct all extra money at the highest-rate debt until eliminated.
Step 4: Roll the freed payment to the next highest-rate debt — the avalanche grows.
Because high-rate debt accrues the most interest per dollar of balance, eliminating it first reduces the total interest bill more than any other ordering strategy.
Frequently Asked Questions
- High interest rates cause the most damage per dollar of balance. Eliminating a 24% credit card before a 6% car loan stops the most expensive interest compounding first, leaving you with more money overall.
- Mathematically yes — it minimises total interest. But if you're prone to giving up, the snowball's quick wins may keep you on track. A completed snowball beats an abandoned avalanche every time.
- On a typical multi-debt scenario, snowball costs $200–$1,000 more in interest than avalanche. The difference depends on how spread out the interest rates are. Use both calculators and compare to make an informed choice.
- If they carry a high interest rate (above 6–7%), yes. Federal student loans below 5% may be better to pay minimums on while directing extra money at higher-rate consumer debt. Sort all your debts by rate and follow the calculator's order.
- The 0% card moves to the bottom of the avalanche order (lowest rate = lowest priority). However, be sure to pay it off before the promotional period ends to avoid retroactive interest charges.