Debt Payoff Calculator

What this tool is used for

• Comparing avalanche and snowball orderings on the same set of balances.
• Seeing how much total interest each strategy costs.
• Working out a debt-free date from a fixed monthly payment.
• Testing what an extra amount each month does to the timeline.
• Deciding which balance to attack first with the numbers rather than by instinct.

Frequently Asked Questions

What is the difference between avalanche and snowball?

Which debt the extra payment attacks. Avalanche targets the highest interest RATE, which is mathematically optimal and always pays the least total interest. Snowball targets the smallest BALANCE, clearing individual accounts sooner. Both pay every minimum every month; they differ only in where the surplus goes.

If avalanche always wins on interest, why would anyone choose snowball?

Because the plan you keep beats the plan you abandon. Snowball closes an account early and frees its minimum payment sooner, and that visible win sustains the behaviour. The interest difference between the two methods is usually modest — run both here and see what yours actually is before deciding on principle.

What happens when one debt is paid off?

Its minimum payment does not disappear — it rolls into the pool attacking the next target. That is the mechanism behind the name: the amount thrown at the focus debt snowballs with every account cleared, so the last debts fall much faster than the first even though nothing was added to the budget.

How are lump sums modelled?

As a one-off addition to the extra-payment pool in a specific month, so a bonus in month 7 goes entirely to whichever debt is the current target. Because interest is charged on the balance every month, an early lump sum removes far more total interest than the same amount applied later.

Why does the simulation stop after 600 months?

Fifty years is a hard stop that catches the case where minimum payments barely exceed the monthly interest — the balance then falls so slowly it would never converge. Hitting the cap is itself the finding: those minimums are not a repayment plan, and the fix is a larger payment or a lower rate, not a longer horizon.

Common errors and gotchas

• Choosing snowball for the motivation and not noticing the extra interest it costs.
• Assuming rates hold, when promotional periods expire and variable rates move.
• Forgetting minimum payments on the other balances while one is being attacked.
• Adding new borrowing during the plan, which resets the arithmetic silently.
• Treating the projected date as fixed when income is variable.