Debt Avalanche
You have several debts and one monthly budget. Aim your extra payment where it saves the most, and compare your plan with the best one.
Frequently asked questions
What is the debt avalanche method?
Pay the minimum on every debt, then put all extra money toward the debt with the highest interest rate. When it is paid off, move to the next highest. It usually costs the least interest.
What is the debt snowball method?
Pay off the smallest balance first, whatever its rate. It can feel motivating because debts disappear sooner, but it often costs more in interest than the avalanche.
Which method is better?
The avalanche saves the most money. The snowball can help people stay motivated. The best plan is the one you will actually stick to, ideally with an eye on the interest rates.
Is this financial advice?
No. It is an illustrative game with simplified numbers. Real debts have fees, changing rates and other rules.