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Debt
The CFPB (July 16, 2019; the original URL now redirects to that archive) names two ways to send extra money. The highest interest rate method attacks the balance that costs the most. The snowball method attacks the smallest balance so a debt disappears. Both still require the minimum on every other bill. This page does not pick a personality. It shows when the two lists are the same, and what the classroom calculator does when they are not.
Updated 2026-10-06 · 10 min read · Educational, not credit counseling. The three debts below are labeled inputs, not a quote. Three-debt math stays on the avalanche vs snowball calculator. One card is the payoff calculator. The whole sheet is the debt-free playbook.
List every non-mortgage debt with balance, APR, and minimum. Pay every minimum so nothing goes delinquent. All extra cash hits one target.
Snowball: smallest balance first. The CFPB says you see progress quickly as each smaller debt is gone, and the freed payment joins the next smallest. It also says you may pay more in the long run, because you are not focused on the costliest debts.
Avalanche, which the CFPB calls the highest interest rate method: highest APR first. The page says it may not feel like progress, and that clearing the costliest debts first can save money. It does not say you will finish. If the early win is the only reason the extra payment continues, snowball is the method that matches that fact. The interest gap only exists if both plans actually get the extra.
The Federal Reserve G.19 release of September 8, 2026, Terms of credit, credit card plans, not seasonally adjusted:
| Column | All accounts | Accounts assessed interest |
|---|---|---|
| 2026 Q2 | 20.94% | 22.15% |
| May 2026 | 20.94% | 22.15% |
| June 2026 and July 2026 | n.a. | n.a. |
Footnote 5 on that release splits the two rates. All accounts is the stated APR averaged across credit card accounts at the reporting banks, including accounts that never pay interest. Accounts assessed interest is the annualized ratio of total finance charges to the average daily balances those charges were assessed on. It excludes accounts with no finance charge. 22.15% is the better description of a carried balance as a national average. It is still not your APR. 24% and 18% in the table below are examples so the two methods diverge. Do not paste 20.94 into the calculator unless the statement says 20.94.
These are the tool's own defaults. Interest each month is balance times APR divided by 12, added before the payment. When a debt hits zero, its minimum joins the extra pool in that same month. That is the tool's convention, not a daily periodic rate, and not a servicer's rounding. Late fees, penalty APRs, and 0% windows are ignored.
| A | B | C | |
|---|---|---|---|
| Balance | $2,000 | $5,000 | $8,000 |
| APR | 6% | 24% | 18% |
| Minimum | $50 | $125 | $160 |
| Extra | $250, after every minimum | ||
| Snowball | Avalanche | |
|---|---|---|
| Order at month 1 | A, then B, then C | B, then C, then A |
| First debt gone | A in month 7 | B in month 16 |
| Done | 42 months | 38 months |
| Interest | $5,104.27 | $4,150.32 |
| What the tool prints | $5,104 | $4,150 |
The gap is $953.95, which the tool's whole-dollar format shows as about $954, and four fewer months on avalanche. Snowball finishes A first because $2,000 is the smallest balance, even though 6% is the cheapest rate. Avalanche leaves A for last. Open the same inputs here: the share link. Change an APR and the months move. This page will not freeze a scraped "today's card rate" into that hash.
A $1,200 store card at 28% beside an $11,000 student loan at 6% is the other shape. The store card is both smaller and more expensive, so both methods hit it first. That is common sense, not a test of which book you read. The student-loan guide owns IDR versus refinance. This page does not restate it.
Regulation Z § 1026.53(a) covers one open-end credit card that is not home-secured. If you pay more than the required minimum, the issuer must apply the excess first to the balance with the highest annual percentage rate on that account, and the rest in descending rate order. A purchase balance and a cash-advance balance on the same card are that rule. Two different lenders are not. Sending the extra check to the 6% loan while a 24% card only gets its minimum is still snowball, even though each issuer follows § 1026.53 on the dollars that card actually received.
One card, with no second minimum rolling onto it, is the payoff calculator. Do not type a promotional 0% into that tool and trust the month count. The tool ignores promo windows.
Keep a small cash sleeve so the next surprise does not go back on a card. This page does not set the dollar amount. The debt-free playbook is the 12-step file for the sleeve, the match, the switch date if you have already quit a written plan, and what a freed minimum becomes. It is behind the existing premium wall. This guide does not rewrite those steps.
Keep the 401(k) match. The match percent is whatever the plan document says. Pausing the deferral that captures it is not "getting serious." Optional brokerage can wait while card APRs sit far above a savings yield. A mortgage-rate balance is a different file. It is not the target just because it is the largest balance.
A 0% or low-rate transfer is not a third payoff method. CFPB (page last modified September 2, 2026) says the promotional rate on most balance transfers lasts a limited time, a balance-transfer fee usually applies, and new purchases on that card may not get a grace period until the transferred balance is paid in full. If you are more than 60 days late, the issuer can raise the rate on all balances. The fee-versus-staying arithmetic is the balance-transfer calculator. The clock is the transfer playbook. Do not rebuild either here.
In the calculator, with the same minimums and the same extra, avalanche interest is less than or equal to snowball interest. On the labeled defaults, that is 38 months and $4,150.32 versus 42 months and $5,104.27. The page rounds those to $4,150 and $5,104. The CFPB does not promise you will stick with it.
Minimums on everything. Extra dollars to the smallest balance. When it dies, that payment joins the next smallest. The CFPB says the progress shows up quickly, and that you may pay more because the costliest debt waited.
Extra dollars to the highest APR. The CFPB says it may not feel like progress, and that clearing the costliest debts first can save money. Quitting is outside that sentence.
When the smallest balance is also the highest APR. The defaults diverge on purpose: $2,000 at 6% is small and cheap. A store card that is both smallest and most expensive is one list.
Only if your statement says so. G.19, released September 8, 2026, shows those two figures for 2026 Q2 and for May 2026. June and July are n.a. 20.94% averages stated APRs, including cards that pay in full. 22.15% is accounts that were charged interest. Type your APR.
Inside that one account, yes. Regulation Z § 1026.53(a) sends the amount above the minimum to the highest APR balance on that card. It does not pick which lender gets the extra check.
No. The match percent is in the plan document. Optional brokerage can wait. The cash-sleeve amount and the rest of the order are the debt-free playbook, not a second number on this page.
Three debts: the avalanche vs snowball calculator. One card: the payoff calculator. A promo: the transfer guide. The 12-step sheet: the debt-free playbook.
Educational only. CFPB describes the two methods and does not guarantee you will finish either one. G.19 rates are commercial-bank averages for 2026 Q2, not a rate to type unless it is yours. The dollar gap is the calculator's monthly convention on labeled inputs. Not a payoff quote and not advice.