Debt Avalanche Calculator
Simulate the avalanche method: pay minimums on all, then throw the surplus at the highest-rate debt first — minimise total interest.
Input Data
Results
At a glance:Avalanche: pay each debt's minimum, then direct all leftover of a fixed total budget to the HIGHEST-rate debt first. Month by month: interest = balance x annual/12; pay minimums; apply surplus to highest rate; repeat until zero; sum months, total paid, total interest. Clearing one debt rolls its minimum into the next highest-rate target (keeping total constant) for acceleration. Mathematically minimises total interest and usually fastest. WARNING: Fixed rates, on-time, no new debt; may feel slow if the biggest debt is the highest rate. Education, not advice.
Formula
Monthly interest_i = balance_i × rate_i / 12.
Budget = Σ min-payments (fixed each month); surplus → debt with the highest rate.
Repeat until all balances are zero; sum months, total paid, total interest.
$$\\text{Interest}_i = \\text{Balance}_i \\times \\dfrac{\\text{Rate}_i}{12}$$$$\\text{Budget} = \\sum_i \\text{MinPayment}_i \\quad (\\text{Monthly fixed})$$How to Use
- Enter up to four debts' balances, rates and minimums.
- Enter a total monthly budget covering all minimums plus surplus.
- View months, total paid, total interest for the avalanche method.
FAQ
How does the avalanche method work?
You pay every debt's minimum, then send all extra from a fixed total budget to the debt with the highest interest rate. Once that is cleared, you roll its old minimum into the next-highest-rate debt. Because you always hit the most expensive balance first, you minimise total interest and usually get debt-free fastest.
How does it differ from snowball?
Avalanche orders by interest rate (highest first) to save the most money; snowball orders by balance (smallest first) for psychological wins. Avalanche is mathematically optimal; snowball can be easier to stick with. Both require keeping the total monthly payment constant.
Why keep the total monthly payment constant?
Because the acceleration comes from rolling a cleared debt's minimum into the next target. If you divert the freed-up money elsewhere, you lose the speed and interest savings. Keep paying the same total every month.
How much can high-interest Hong Kong card debt cost?
Hong Kong credit-card revolving APRs commonly run ~20%-36%, far above personal loans. If you hold both high-rate card debt and lower-rate loans, avalanche clears the card first and can cut interest materially. Actual savings depend on balances, rate gaps and your available total budget.
What are the assumptions and data basis of this calculator?
It simulates month by month: each debt accrues interest (balance x annual rate / 12), minimums are paid first, and the fixed total budget's surplus goes to the highest-rate debt, repeating until all are cleared, tallying months, total paid and total interest. Avalanche/snowball are internationally recognised repayment concepts; for Hong Kong debt-management guidance see the Investor and Financial Education Council (IFEC). Results assume fixed rates and on-time monthly payments; for planning reference only.
Related Tools
References
Content review: Calculatorism Finance Team. Results are for reference only; please refer to the relevant authorities for the official figures.