Debt Avalanche Calculator
Model the avalanche payoff method — pay minimums on every debt, then send every spare pound or dollar at the highest-APR balance until it clears, then roll its payment into the next one.
Months to debt-free
25 months (2.1 years)
- Total paid
- £12,047.13
- Total interest paid
- £2,047.13
- Starting balance
- £10,000.00
- Payoff order (highest APR first)
- Debt 1 → Debt 2 → Debt 3
Pay every debt its minimum each month, then send everything left from your monthly budget to the highest-APR debt. As each debt clears, its payment rolls into the next-highest APR.
How to use this calculator
Enter the balance, APR, and minimum monthly payment for up to three debts — credit cards, personal loans, store cards, anything compounding monthly. Then enter the total monthly amount you can put toward debt (this must cover the sum of the minimums, with something left over to make progress). The calculator simulates month-by-month payments, applies interest, pays every minimum, then throws every remaining penny at the highest-APR balance. As each debt clears, its payment rolls into the next-highest APR. You get the total months to debt-free, the total amount you will pay, the total interest, and the order in which your debts get cleared.
How the calculation works
The avalanche method is the mathematically optimal strategy when minimums are fixed: the balance compounding fastest is always the one with the highest APR, so directing surplus payments there minimises total interest. Each month the simulator applies interest at r = APR/12 to every surviving balance, pays each debt its minimum (capped at the remaining balance), then sorts the remaining debts by APR and pays them down in that order until the monthly budget is spent. When a debt hits zero the budget that previously went to its minimum is freed up and joins the surplus pool — this "rolling payment" effect is why the later debts get paid off much faster than the first one. The simulation stops when every balance is cleared, or after 50 years if the budget is too small to make progress.
Worked example
Three debts: 5,000 at 22% APR (100/mo min), 3,000 at 18% (75/mo min), and 2,000 at 15% (50/mo min). Total minimums: 225/mo. With a 500/mo budget, the first month accrues about 91.67 + 45.00 + 25.00 = 161.67 in interest. After paying every minimum, 275 of surplus goes to Debt 1 (highest APR at 22%). Debt 1 clears first, Debt 2 next, Debt 3 last — total payoff is roughly 25 months with about 2,050 in interest. By comparison, paying only the 225 in minimums leaves Debt 1 barely shrinking (its minimum is only slightly above the monthly interest charge), dragging the same payoff out for many years and costing far more in interest — the classic minimum-payment trap.
Frequently asked questions
What is the difference between the debt avalanche and debt snowball methods?
Both methods pay minimums on every debt and direct any extra money at one chosen debt until it clears. The avalanche attacks the debt with the highest APR first, because that is the balance compounding fastest — this minimises the total interest you pay. The snowball attacks the smallest balance first regardless of rate, because clearing whole debts quickly produces visible wins that help motivation. The avalanche is mathematically optimal. The snowball is psychologically optimal. If you are choosing on numbers alone, use this calculator (avalanche). If you have tried and failed to stick with a debt plan before, the snowball is a reasonable trade-off — you pay a little more interest in exchange for momentum.
Does my budget have to cover all the minimum payments?
Yes — and it has to cover the sum of the monthly interest charges across every debt, or the total balance will grow rather than shrink. If your budget is less than the combined first-month interest, the calculator returns "never clears". This is the multi-debt version of the credit card minimum-payment trap. If you cannot cover the minimums, the avalanche method does not apply — at that point you are in a hardship situation and should consider a balance transfer, hardship plan with the issuer, or non-profit credit counselling (the CFPB and StepChange in the UK both offer free guidance).
Should I include my mortgage in this calculator?
Usually no. The avalanche method is designed for unsecured, high-interest, revolving or short-term debt — credit cards, store cards, personal loans, payday loans, BNPL balances. Mortgages and student loans typically have much lower APRs and longer terms, and there are often tax or refinancing considerations that change the maths. Use this for your high-APR debts first; clear them; then separately decide whether early mortgage repayments make sense for your situation (see our mortgage payoff calculator).
What happens when a debt is paid off — does the avalanche speed up?
Yes, and that is the key to why the method works. When Debt 1 clears, the money that was going to its minimum payment (plus all the surplus that was attacking it) is freed up. The calculator automatically rolls that entire amount onto the next-highest APR debt. So your effective monthly attack on Debt 2 is now much larger than what you started with — and your monthly attack on Debt 3 is larger still. Each cleared debt accelerates the rest, which is why total payoff time can be a fraction of what each debt would take in isolation.
Why does the calculator only support three debts?
Three is the right balance between usefulness and form length — most people with high-interest debt have one to three problem balances driving the cost, and modelling those captures the avalanche dynamic completely. If you have four or more, group the lowest-priority balances by APR (sum balances, take the weighted average APR, sum the minimums) and enter the group as a single "debt" row. The total payoff time and interest will be a very close approximation to a full per-debt simulation, and the attack order is still correct: highest APR first.
Is the calculator using daily or monthly compounding?
Monthly. Credit card issuers typically apply daily periodic interest (APR / 365) to each day's balance, but for an avalanche payoff projection the monthly approximation (APR / 12) is within a fraction of a percent of the daily method for any realistic balance and APR. The calculator returns the right answer to the nearest month — which is what matters for choosing a strategy. The exact daily-compounding figure your card will charge will be a few pounds or dollars different over the full payoff window; the strategy ranking does not change.