Credit Card Payoff Calculator
How to Pay Off Credit Card Debt: The Debt Avalanche Method
This calculator uses the **Debt Avalanche** method, a strategy that saves you the most money on interest. Here’s how it works: you make the minimum payment on all your cards, then you put any extra money from your budget toward the card with the highest Annual Percentage Rate (APR). Once that card is paid off, you "avalanche" that full payment amount onto the card with the next-highest APR, and so on, until you're debt-free[attached_file:1].
Debt Avalanche vs. Debt Snowball
The main alternative to the Debt Avalanche is the **Debt Snowball** method. With the Snowball method, you pay off the card with the smallest balance first, regardless of the interest rate. This can provide a powerful psychological boost from scoring quick wins. While the Debt Avalanche is mathematically the most efficient way to save money, the best method is the one you can stick with consistently[attached_file:1].
Frequently Asked Questions (FAQ)
Why is the Debt Avalanche method more cost-effective?
Because you are tackling the most expensive debt first (the one with the highest interest rate), you are minimizing the total amount of interest that accrues over the life of your debt. This means more of your money goes toward paying down the principal balance, getting you out of debt faster and for less money overall.