Debt Payoff Strategy Comparator

How to use this in 60 seconds

1. List every debt with its balance, APR, and minimum payment. Credit cards typically sit at 18–28% APR, student loans 4–8%, mortgages 6–7%, auto loans 5–10%. The interest rate spread between your highest and lowest debt is what drives the Avalanche vs Snowball decision.
2. Set the extra monthly payment you can realistically commit. $200/mo is enough to make a real difference on a 5-figure debt load; $500/mo dramatically compresses the timeline. Be honest — overcommitting and falling off track is worse than a smaller payment you actually make.
3. Read the verdict card. Avalanche almost always wins on math when there's significant APR spread (5+ points). Snowball wins on psychology — clearing small balances builds momentum. The tool shows the dollar gap between the two so you can decide whether the math premium is worth the motivational cost.

Avalanche vs Snowball vs invest the extra

Avalanche attacks the highest-APR debt first. If you have $8K on a 24% card and $20K of 6% student loans, every extra dollar at the card saves $0.24/year in compound interest — four times the savings of paying the student loan early. On a typical mixed debt load, Avalanche saves $1,500–$5,000 in interest vs Snowball over the full payoff period.

Snowball attacks the smallest balance first. The behavioral economics research (Gal & McShane 2012) found that people who use Snowball are statistically more likely to fully clear their debt — quick wins keep them engaged. If you've previously abandoned debt-payoff plans, that engagement bonus may be worth the extra interest cost.

Investing the extra instead beats both only when your debt APR is below your expected investment return after taxes. With S&P long-run ~7% real and credit card APRs at 24%, it's never the right call to invest while carrying revolving credit. Once debts are below ~5% APR (typical for federal student loans and mortgages), the math flips and investing usually wins.

Math runs locally. We don't store your inputs.

Where this framework breaks

• Variable APRs. The tool uses your current rate as fixed. Credit cards often raise rates after missed payments (penalty APR), and variable-rate student loans move with prime. If your effective APR could spike, lean toward Avalanche to retire the highest-rate debt fastest.
• 0% intro offers and balance transfers. A 0% balance transfer with a 3% fee can beat Avalanche if you'll clear the balance before the promo ends. The model doesn't price in promo periods.
• Tax-deductible interest. US mortgage interest and (capped) student loan interest are tax-deductible. Effective APR on a 7% mortgage at a 24% marginal bracket is closer to 5.3%, which can flip the invest-vs-payoff decision.
• Emergency fund first. If you have no liquid cash buffer, paying down debt aggressively then needing a new credit card draw at 24% to cover a car repair undoes weeks of progress. The conventional sequence is: $1K starter buffer → minimums on all debt → snowball/avalanche → 3-6 month full emergency fund.