Debt payoff calculator (avalanche vs snowball)
Two strategies, one goal — get out of debt faster.
You have debt and some extra cash each month. Do you attack the highest interest rate, or the smallest balance?
Enter up to three debts (balance, APR, minimum) and the extra you can pay. The calculator runs both the avalanche and snowball and shows the months and interest each costs.
Two strategies, one goal
You have debt and some extra cash each month. How you apply that extra determines how long you stay in debt and how much interest you burn. The two classic methods are the avalanche (highest interest rate first) and the snowball (smallest balance first). The calculator runs both on your exact debts and shows the months and interest each one costs.
Avalanche saves the most money
Paying the highest-rate debt first mathematically minimizes total interest, because every dollar you throw at a high rate stops more interest from compounding. It is the spreadsheet’s favorite, and for a freelancer watching every dollar, the interest saved is real cash that can go back into the business or a buffer. The calculator reports exactly how much avalanche saves versus snowball — often thousands.
Snowball wins the mind
The snowball ignores rates and kills the smallest balance first. The win is behavioral: a debt disappearing builds momentum, and on the irregular income freelancers live with, that visible progress is what keeps the plan alive through a lean month. Mathematically it usually costs more interest, but a plan you actually stick to beats a perfect plan you abandon. The calculator shows the trade-off in plain dollars so you can choose with eyes open.
Why extra cash is the lever
On minimum payments alone, the two strategies finish together — it is the extra you throw at debt that the ordering directs. Even a modest extra payment, applied consistently, can cut years off the timeline. Freelancers should treat debt payoff as a line item in the Profit First operating plan: the cash exists only if you name it first.
Irregular income changes the math
A salaried person can promise a fixed extra payment; a freelancer’s months swing. The practical fix is to base the "extra" on your worst recent month, then throw bonu-style months entirely at debt. The calculator’s extra field is your floor — anything above it is gravy. Keeping the floor low enough to survive a slow month is what prevents a missed payment from undoing the plan.
Minimums are not optional
Whatever strategy you pick, every debt gets at least its minimum each month — missing one triggers fees and credit damage that dwarf any interest saved. The calculator assumes minimums are always paid and your extra goes on top. If a month is so thin you cannot make a minimum, that is a cash-flow emergency the debt plan cannot solve; the emergency fund calculator is the prior step.
Estimates only. The simulator assumes fixed balances, fixed APRs, and fixed minimum payments, with interest compounding monthly and all minimums always paid. It ignores fees, rate changes, deferred-interest traps, and tax-deductible interest (e.g., some business loans). Results show months and total interest under each strategy; real payoffs shift with any change to those inputs. Use it to compare strategies, not as a promise of a credit outcome.
Frequently asked questions
Which strategy saves more money?
Avalanche — paying the highest-rate debt first — always minimizes total interest paid, because it stops the most expensive interest from compounding. The calculator shows the dollar difference versus snowball.
Why would anyone pick snowball then?
Because it clears the smallest balance first, producing visible wins that keep you motivated through irregular-income months. A plan you stick to beats a perfect plan you quit. The calculator shows the interest cost of that choice.
Does the extra payment matter more than the order?
Yes, fundamentally. On minimums alone both strategies finish together; it is the extra cash you apply that the ordering directs. Even a small consistent extra cuts years off the timeline.
How should a freelancer with uneven income use this?
Set the "extra" field to your worst recent month’s spare cash as a floor, then throw any better month entirely at debt. Keeping the floor survivable prevents a slow month from breaking the plan.
What if I miss a minimum payment?
That triggers fees and credit damage that dwarf any interest saved. Minimums are always paid first; the extra goes on top. If a month is too thin for a minimum, that is a cash-flow problem the debt plan cannot fix.
Can I model more than three debts?
The calculator handles up to three here. For more, group the smallest into one line or run them as a combined balance — the strategy comparison still holds, and avalanche’s interest advantage remains.