Money Snowball or avalanche: which debt should you pay off first?
Enter your debts and the total amount you can pay each month. The calculator compares both methods with your numbers.
Avalanche: extra money goes to the debt with the highest rate. Snowball: to the smallest balance. Both keep paying every minimum. Simplified, fixed rates, no fees.
The avalanche method
You pay the minimum everywhere. Every extra dollar or euro goes to the debt with the highest interest rate. Once it is gone, its payment moves to the next most expensive one. Mathematically this is almost always the cheapest way.
The snowball method
Here the extra money goes to the smallest balance. You get a quick win because the first debt disappears soon. It usually costs a little more interest, but helps many people stay on track.
What matters most
The difference between the two is often smaller than expected. Far more important is paying more than the minimum at all and not adding new debt. The Money Compass debt plan keeps calculating with your real debts.
Frequently asked questions
Which method is better?
The avalanche usually saves more interest. The snowball motivates with quick wins. The best method is the one you stick with.
What if my budget does not cover all minimum payments?
Then no method alone will help. Talk to your creditors or a free debt counselling service.
Should I save at the same time?
A small emergency fund prevents new debt. After that, paying off expensive debt quickly usually pays off.