Loans · Canada
Debt snowball calculator.
Compare the snowball and avalanche methods side-by-side. See which approach gets you debt-free faster, how much interest each saves, and which debt you pay off first.
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Debt snowball vs avalanche
Both methods eliminate debt, but they approach it differently. Choose the one that fits your personality and financial situation.
Debt snowball method
How it works: Pay the minimum on all debts except the smallest. Put all extra money toward the smallest debt. When paid off, roll that payment to the next smallest debt.
Advantages: Quick wins boost motivation, simple to understand, builds psychological momentum.
Best for: people who need motivational boosts, those with multiple small debts, and anyone who has failed at debt payoff before.
Debt avalanche method
How it works: Pay the minimum on all debts except the highest interest rate. Put all extra money toward the highest-rate debt. When paid off, roll that payment to the next highest rate.
Advantages: Saves the most money on interest, mathematically optimal, fastest debt elimination.
Best for: disciplined people, those with large high-interest debts, and people motivated by math, not emotions.
Keys to success
- Track your progress monthly.
- Celebrate small wins as each debt is cleared.
- Avoid taking on new debt while paying off old.
- Find extra money to accelerate payoff: even $50 a month helps.
- Stay consistent: the plan only works if you stick with it.
Worked example: three debts and $200 extra a month
The calculator’s starting case is a $5,000 credit card at 19.99% (minimum $150), a $15,000 student loan at 5.5% (minimum $300) and a $10,000 car loan at 7.5% (minimum $200), with $200 a month on top. Both methods return the same plan: debt-free in 4y 0m with $4,105 of interest, and the first debt cleared is the Credit Card in 17 months. They agree because the card is both the smallest balance (what the snowball attacks first) and the highest rate (what the avalanche attacks first).
The methods diverge when the smallest debt is not the most expensive. Take a $12,000 line of credit at 21% (minimum $250), a $2,000 loan at 6% (minimum $60) and a $9,000 car loan at 8% (minimum $200), again with $200 extra:
| Debt-free in | Total interest | First debt cleared | |
|---|---|---|---|
| Snowball (smallest balance first) | 4y 10m | $9,650 | Small loan in 8 months |
| Avalanche (highest rate first) | 3y 8m | $6,118 | Line of credit in 37 months |
- The avalanche saves $3,532 of interest and 14 months here, because the 21% line of credit costs far more to carry than the 6% loan.
- The snowball gives the earlier win: the first debt is gone in 8 months instead of 37 months, which is why some people stick with it. The cost of that motivation is the extra interest above.
Next steps: see a single balance in detail with the credit card payoff calculator, test whether one lower-rate loan helps with the debt consolidation calculator, or model extra payments on one loan with the early payoff calculator.
How this is calculated
- Order: snowball sorts debts by smallest balance; avalanche sorts by highest interest rate.
- Each month, every debt accrues interest = balance × annual rate ÷ 12 and receives its minimum payment. Your extra amount goes to the first debt in order that still has a balance.
- Roll-over: when a debt is cleared, its minimum payment and any leftover money move to the next debt, which is the “snowball.”
- Total interest is added up over every month until all balances reach zero (stopping at 600 months).
The calculator assumes fixed rates, no new borrowing and no fees, and that you keep paying the full minimums on every debt. The Financial Consumer Agency of Canada describes both strategies: paying the highest interest first means you pay less interest and are debt-free sooner, while paying the lowest balance first can show quick progress and help you stay committed, but may cost more over time (FCAC, Paying off your debt, checked 1 October 2026).
General information, not financial advice. Contact your lenders or a non-profit credit counsellor if you cannot afford your minimum payments.
Frequently asked questions
What is the difference between the debt snowball and the debt avalanche?
The snowball pays the smallest balance first; the avalanche pays the highest interest rate first. In both you pay the minimum on every other debt and roll each freed-up payment into the next target. The FCAC describes the same two approaches.
Which method saves more money?
The avalanche, whenever the highest-rate debt is not also the smallest. On the second example it saves $3,532 of interest. When one debt is both smallest and most expensive, as in the default case, the two methods give identical results.
Why would I choose the snowball if it costs more?
Because it clears debts sooner, which can keep you motivated. The FCAC says starting with the lowest balance can show progress quickly and help you stay committed, but may cost more over time. The better method is the one you will actually finish.
What does the extra monthly payment do?
It is added to the first debt in your chosen order on top of its minimum. When that debt is gone, the whole freed-up payment moves to the next debt, so the amount going to debt each month stays constant until everything is repaid.
Does the calculator include fees or variable rates?
No. It assumes fixed rates and no new charges. If a card is on a promotional rate or a line of credit is variable, rerun the numbers when the rate changes.
Disclaimer
This calculator provides estimates based on consistent payments and no new debt. Actual results depend on interest rate changes, payment timing, and avoiding new debt. Consult a licensed financial advisor for personalized advice.