We live in Ohio, USA. Our household rent
For reference only. Not investment advice.
Question
We live in Ohio, USA.
Our household rent, utilities, baby food, and essential medications are fully covered with no gap. We have $450 extra budgeted each month specifically to pay down our two credit cards:
- Card A: $4,500 balance at 22.99% AP (minimum payment $135/month)
- Card B: $1,200 balance at 16.50% AP (minimum payment $35/month)
Total monthly budget for debt payoff: $620 (135 + 35 + 450).
I know Avalanche targets higher AP to save interest, while Snowball targets the smallest balance for psychological wins.
- Could you provide a side-by-side comparison table of Avalanche versus Snowball (months to debt-free, total interest paid under monthly compounding), without picking or declaring one method superior?
- What are the distinct trade-offs between saving total interest vs clearing one account quickly?
Answer
ent, utilities, baby food, and essential medications are covered with no gap, so this is a repayment comparison on the $620 monthly debt budget.
| Strategy | Order | Months to debt-free | Total interest (monthly compounding) |
|---|---|---|---|
| Avalanche | Card A (22.99%) → Card B (16.50%) | 11 | 565.29 USD |
| Snowball | Card B (16.50%) → Card A (22.99%) | 11 | 616.69 USD |
Source: this turn's `payoff.py ok:true` stdout; monthly compounding, model not a prediction.
Both routes finish in 11 months, so the time-to-zero is the same under your $620 budget. The difference is shape, not clock.
What Avalanche buys — total interest $51.40 lower (565.29 vs 616.69 USD). Every extra dollar sits on the higher AP until Card A is gone, which is the cheapest mathematical path.
What Snowball buys — Card B clears in 3 months (last payment 260.09 USD) instead of waiting until month 9 or 11. That is a closed account and one fewer minimum to track earlier, while Card A continues to accrue at 22.99%.
Trade-off, in your words
- Save interest → Avalanche. The 51.40 USD stays in your pocket; you keep paying two minimums the whole way.
- Clear one account quickly → Snowball. Card B is gone by month 3; you carry Card A alone from month 4 onward, but you pay about 9% more interest overall.
Neither method is superior on every measure — Avalanche wins on dollars, Snowball wins on the visible "one card done" milestone. Pick by which trade-off you actually want to live with for the next 11 months.