Debt Snowball vs Avalanche Calculator

What Is the Debt Snowball Method?

The debt snowball method focuses on paying off your smallest debt balance first, regardless of interest rate. You make minimum payments on all debts while putting extra money toward the smallest balance.

Once the smallest debt is paid off, you roll that payment into the next smallest debt, creating a "snowball" effect that builds momentum as each debt is eliminated.

What Is the Debt Avalanche Method?

The debt avalanche method prioritizes debts with the highest interest rates first. You make minimum payments on all debts while directing extra payments to the debt charging the most interest.

This mathematical approach minimizes total interest paid and typically results in faster debt elimination and lower overall cost compared to the snowball method.

Which Strategy Saves More Money?

The debt avalanche almost always saves more money because it targets high-interest debt first, reducing the amount of interest that accrues over time.

However, the debt snowball can provide psychological benefits through quick wins. Some people find these early victories motivating enough to stick with their debt payoff plan, which may be more valuable than saving a few hundred dollars in interest.

How Extra Payments Change Results

Any extra payment beyond minimums accelerates debt payoff significantly. Even an extra $50-100 per month can save thousands in interest and shorten your debt-free timeline by months or years.

The more you can pay above minimums, the smaller the difference becomes between snowball and avalanche methods in terms of total interest paid.

What is the difference between debt snowball and avalanche?

The debt snowball method pays off debts from smallest to largest balance regardless of interest rate, while the debt avalanche method prioritizes debts with the highest interest rates first. Both methods require paying minimums on all debts while applying extra payments strategically.

Which debt payoff method is better?

The debt avalanche saves more money in interest by targeting high-rate debts first. However, the debt snowball can provide psychological wins through quick payoffs of smaller debts, which helps some people stay motivated. The best method depends on your personal situation and what keeps you motivated.

Does the debt snowball save money?

The debt snowball typically costs more in total interest than the debt avalanche because it doesn't prioritize high-interest debts. However, it can save you money compared to making only minimum payments, and the psychological benefits may help you stick with your debt payoff plan.

How much faster can I get out of debt?

Making extra payments beyond minimums can reduce your debt payoff time by months or years. The exact timeline depends on your total debt, interest rates, and how much extra you can pay each month. Both snowball and avalanche methods accelerate payoff compared to minimum payments only.

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