How this calculator works
Every debt receives its minimum payment each month. Any extra money, including the minimum freed when a debt is cleared, is directed at one target debt. The snowball method targets the smallest balance so you see accounts close sooner; the avalanche method targets the highest interest rate so you pay less overall. With the minimum-only strategy the extra payment is also aimed at the smallest balance, so choosing that strategy with an extra of zero shows the baseline cost of paying only what is required. Interest is charged monthly at one twelfth of each annual rate, and the model assumes no new borrowing, fees or promotional rates.
Formula
Each month: interest on debt d = balance_d × rate_d / 12. Minimum payment p_d reduces the balance. Pool = extra payment + any minimum not needed because a balance is nearly clear. The pool pays the target debt, then the next target when that debt reaches zero. Repeat until all balances are zero. Total interest is the sum of monthly interest across all debts.
Worked example
Three debts of $2,000 at 4.9%, $6,000 at 19.99% and $15,000 at 7.5%, with minimums of $100, $150 and $350, total $23,000 with $600 of required payments. Paying only the minimums clears them in 64 months and costs $6,470.13 of interest. Adding $100 a month under the avalanche strategy finishes in 46 months with $4,235.25 of interest, a saving of $2,234.88. The same extra payment under snowball clears the small $2,000 debt in month 11 but finishes in 47 months and costs $4,824.96, so the ordering matters.
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Frequently asked questions
Snowball or avalanche?
Avalanche always costs less when rates differ because it attacks the most expensive money first. Snowball gives quicker wins as small balances close, which some people find easier to sustain. Compare both with your own numbers before choosing.
What counts as a minimum payment?
Use the required payment on each account, not the amount you would like to pay. The extra payment is the money above those minimums that you can commit every month.
Does the freed minimum get added to the target?
Yes. When a debt is cleared, its minimum is no longer owed, so that money joins the pool and accelerates the next target. This is how the snowball and avalanche methods speed up over time.
Can I include a mortgage?
You can enter any debt with a fixed minimum. A mortgage payment includes principal and interest and a large balance, so mixing it with consumer debt can hide the effect on the debts you can realistically clear first.