Debt snowball vs avalanche simulator
The avalanche order aims the money left over after the minimums at the highest rate; the snowball aims it at the smallest balance. On the illustrative default of three debts, both clear in 34 months, the snowball pays about 9 percent more interest, and it frees its first debt at month 7 rather than month 19.
Interest the avalanche order keeps
$340
Paying $700 a month clears all three in 34 months either way, and the snowball frees its first debt at month 7 rather than month 19.
The snowball costs 9.3% more interest here, and never less.
- Store card $1,800 at 12.5%, minimum $45
- Credit card $6,200 at 24.9%, minimum $155
- Car loan $11,500 at 9.4%, minimum $240
In short
- Drag the rail under the chart to change the total you pay across all three debts each month.
- Compare the solid avalanche line with the dashed snowball line, and read the dot on each for the month it clears its first debt.
- Check the two interest bars below the chart to see what the ordering costs.
- Drag the payment down to the minimums to reach the case where both orders behave identically.
What the two curves show
Both plans send the same total out each month. Every debt gets its minimum, and whatever is left over goes at one debt: the highest APR under the avalanche, the smallest balance under the snowball. Once that debt clears, its minimum joins the surplus and the whole amount rolls onto the next one in the order, which is why either curve steepens as it goes.
The two lines are drawn on the same axes and they almost overlap. That is not a drawing error. The order changes only which balance is carrying interest while the others wait, so the difference builds slowly and arrives at the end as a slice of interest rather than as a different shape.
Why the avalanche never costs more
A unit of money aimed at the highest rate removes more future interest than the same unit aimed anywhere else, and that holds in every month, so no other order can finish having paid less interest. Highest rate first is the cheapest order there is, and every alternative either ties with it or loses to it.
The gap is usually smaller than the argument sounds. On the default payment the snowball pays about 9 percent more interest, which is under 2 percent of the amount owed at the start, and both orders reach zero in the same month. Raise the payment above that and the amount the ordering is worth falls at every step, while its share of the avalanche's interest drifts from about 9 percent down to about 7 percent at the top of the rail, because there is less time for the ordering to matter at all.
What the snowball buys instead
Speed to the first win. On the default the snowball clears a debt at month 7 while the avalanche is still 12 months away from clearing its first, and one fewer account to keep track of every month is a real change for someone holding several. The avalanche takes that back later in interest, so the choice is between the cheaper order and the earlier win.
When the smallest balance is also the dearest debt, the two orders are the same list and the question does not arise. Drag the payment down to the minimums and they match for a different reason: nothing is spare to aim until the first debt clears, and by the time one does, both lists are pointing at the same debt.
Common questions
Which order clears the debt sooner?
The avalanche, or a tie. Less interest is charged along the way, so the same monthly payment retires the balances at least as fast. On the default payment both orders finish in the same month, and at roughly a third of the payments on the rail the avalanche finishes one month earlier.
Does the snowball ever pay less interest?
No. Highest rate first is the cheapest order available, so the snowball ties with it at best and never beats it. It ties when the two lists happen to run in the same sequence, and it ties at the bottom of the rail, where nothing is spare to aim until the first debt clears and by then both lists point at the same one.
How much does the order actually change?
Less than the argument suggests. On the default the snowball costs about 9 percent more interest, which is under 2 percent of what was owed at the start, and both plans finish in the same month. The size of the payment moves the result far more than the order of the debts does.
Keep reading
This page is educational material, not financial advice. The figures come from the formula shown and assume the inputs you enter hold for the whole term. Your own rate, fees, taxes and timing will differ, so treat the output as arithmetic to check a decision against, not as a recommendation.