Snowball vs avalanche in a debt spreadsheet
Both methods start by covering every required minimum. They differ in the debt that receives extra money. Compare them using the same balances, rates, minimums and budget.
Smallest balance first
Snowball directs the extra pool to the smallest active opening balance. When that account is paid, the remaining extra can move to the next account in the same month. In later months, the fixed overall budget remains available even though one minimum has disappeared. The result is a rollover of payment capacity, not a reduction in the total budget.
The planner reorders by current balance each month and breaks ties using the original account row. With rates held constant, your account balances may cross as minimums are paid. Inspect the ledger when you need to understand which debt received the next extra dollar.
Highest rate first
Avalanche directs extra money to the highest entered annual rate. It targets interest cost under the model’s assumptions. Equal rates retain row order. The method does not infer a future promotional rate, repricing date or penalty APR. If the contract changes, update the assumptions and retain a dated version.
The motivation behind choosing a method is personal, but the spreadsheet cannot model follow-through or assign a probability that you will make every payment. Its payoff date is conditional on the entered path. Do not turn a calculated saving into a guaranteed outcome.
Use a fair comparison
- Save the unedited example and create a working copy.
- Enter the same starting balances, rates, minimums and payment budget.
- Calculate one strategy and save a dated result.
- Change only the strategy selector and recalculate.
- Compare total interest, payoff timing and the account ledger.
The workbook has one authoritative selector and one build. For simultaneous views, keep separately named copies rather than assuming a displayed old total is a live second strategy. In the browser, download a scenario JSON for each selected method and recalculate after importing it.
When the budget is insufficient
Neither priority rule solves a month where the budget is less than all minimums. This planner stops at that month. It does not choose a debt to leave unpaid or estimate delinquency costs. Review the underlying budget and actual account terms before treating the forecast as usable.
Inspect the spreadsheet and browser planner
Sources and calculation basis
The CFPB description of debt reduction strategies explains paying minimums across debts and directing extra money to a selected priority. Its explanation of credit-card interest describes why real statements may use daily balances and different rates. These sources support the concepts. All workbook layouts, monthly model conventions and invented USD examples here are AllMarkets material.