Debt Avalanche Calculator

This calculator builds the avalanche plan for your debts: minimums on everything, every extra dollar at the highest APR, and each freed-up minimum rolling forward as debts fall. Because interest accrues fastest on the highest-rate balance, this ordering is provably the cheapest way to clear a set of debts with a fixed monthly budget — no other sequence, at the same total payment, costs less.

Beyond the payoff order, debt-free date, and total interest, it prices the strategy question directly: the same debts are also run in snowball order (smallest balance first), and the difference in interest appears as a dollar figure. Sometimes that gap is hundreds of dollars; sometimes — when your smallest debt also happens to carry your highest rate — it's zero, and the choice of method genuinely doesn't matter for your debts.

Month by month, every debt accrues interest at one-twelfth of its APR and receives its minimum payment. Then the entire extra pool — your extra payment plus the minimums of any debts already retired — attacks whichever remaining debt carries the highest APR. When it clears, the pool moves to the next-highest rate, and so on until nothing is left.

The reason this minimizes cost is simple: a dollar of principal removed from a 25% balance stops more interest than the same dollar removed from a 12% balance. The avalanche just applies that logic ruthlessly, every month.

Each month, per debt: interest = balance × (APR ÷ 12), added to the balance; minimums are paid on every active debt; the extra pool then reduces the highest-APR balance. The interest-saved figure comes from running the identical debts and budget through the snowball order and subtracting: snowball total interest − avalanche total interest, floored at zero.

Minimums are treated as fixed dollar amounts (not the shrinking percentage minimums issuers use), APRs are assumed constant, and no new borrowing is added along the way. If any minimum fails to cover its own first-month interest, the plan is flagged infeasible rather than simulated into infinity, and simulations cap at 50 years. Ties in APR are resolved by taking debts in the order entered.

Judge an avalanche result on two numbers. First, the horizon: under three years is a healthy plan; past five years means the extra payment is undersized for the balances, and no ordering cleverness fixes that. Second, the savings versus snowball: when your APRs span a wide range — say a 27% card next to a 10% loan — and the big balances sit at the top of that range, the avalanche's edge grows into hundreds or even thousands of dollars, and sticking to APR order is clearly worth it.

When your APRs cluster within a few points of each other, or your smallest balances happen to carry your highest rates, the savings figure collapses toward zero — and that's useful information too: it means you can take the snowball's motivational structure for free. The avalanche's real cost is patience. If your highest-APR debt is also your largest, the first payoff may be a year or more away with nothing to celebrate in between; the method only wins if you keep paying the full extra amount through that silence. Be honest about that before committing.