🏔️ Debt Avalanche Calculator
Pay highest interest first to maximize savings
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📊 Avalanche vs Snowball
The Debt Avalanche Strategy Explained
The debt avalanche method is mathematically the most efficient way to pay off debt. By targeting the highest interest rate debts first, you minimize the total interest paid over time and become debt-free faster.
How It Works
List all debts by interest rate from highest to lowest. Make minimum payments on everything, then put all extra money toward the highest-interest debt. Once that's paid off, move to the next highest rate. This creates an "avalanche" of debt elimination.
Avalanche vs Snowball: When to Choose Avalanche
- Large rate differences: If your highest rate is significantly higher than others
- Strong discipline: If you can stay motivated without quick wins
- Math-driven decisions: If saving money matters more than psychology
- Large balances: Higher interest on larger debts means bigger savings
Frequently Asked Questions
What is the debt avalanche method?
The debt avalanche method prioritizes paying off debts with the highest interest rates first, regardless of balance size. This mathematically saves the most money on interest over time.
How much can I save with the avalanche method?
Savings vary based on your debt amounts and interest rates. Typically, the avalanche method saves 10-20% more on interest compared to the snowball method, often thousands of dollars on larger debts.