How the two methods differ

Avalanche pays extra money toward whichever debt has the highest interest rate, which minimizes total interest paid over time. Snowball pays extra toward the smallest balance first, which clears individual debts faster and can keep motivation higher even if it costs a bit more in interest. Neither is wrong; they optimize for different things.

What the numbers assume

  • Interest accrues monthly on the remaining balance at the APR you enter.
  • Minimum payments are made on every debt first, then any extra payment goes to the priority debt.
  • Once a debt reaches zero, its minimum payment is freed up for the next priority debt.