How this is worked out
Both schedules are walked month by month, because neither has a closed form.
The minimum-repayment schedule recalculates the repayment each month as the greater of the issuer's floor and a percentage of the current balance plus that month's interest. Since 2011 UK issuers must charge at least the interest, fees and charges for the period plus 1% of the balance — so the balance always falls, but the percentage shrinks with it and so does the progress.
Two conventions exist for the minimum and the difference is not cosmetic. A minimum of "a percentage of the balance plus that month's interest" always reduces the balance. A flat percentage of the balance may not: at a 20–25% APR, 2% of the balance is barely above the month's interest, so the balance decays so slowly that the payoff runs past this calculator's sixty-year horizon. The calculator says which of the two has happened rather than reporting both as failure.
The fixed-repayment schedule holds the amount constant. Interest for the month is balance × APR ÷ 12 and everything above it reduces the balance, so a constant payment clears an accelerating share of principal.
For several debts, avalanche and snowball are both simulated in full: every debt gets its minimum, and whatever remains of your budget goes entirely to one target — the highest rate, or the smallest balance.
A worked example
- Balance / APR
- £4,000 at 23.9%
- Minimum repayment rule
- Interest plus 1% of balance, £5 floor
- First minimum repayment
- £119.67
- Minimum only — time to clear
- 31 years
- Minimum only — interest paid
- £7,745
- Fixed £200 a month — time
- 26 months
- Fixed £200 a month — interest
- £1,153
The minimum was reformed, and it is still a trap
Before 2011 a UK minimum repayment could be less than the interest, so a balance could grow while you paid it. The FSA ended that: the minimum must now cover at least the interest, fees and charges plus 1% of the balance, which guarantees the balance falls.
It guarantees very little else. Because the 1% is taken of a shrinking balance, the repayment shrinks with it and the schedule flattens out over decades. On £4,000 at 23.9% the first repayment is £119.67 — of which £79.67 is interest — and it takes thirty-one years and £7,745 in interest to finish.
The same £4,000 at a fixed £200 a month clears in twenty-six months for £1,153. The first repayment is only £80 higher. What changes is that the number stops retreating.
Persistent debt rules, and the letters you may already have had
Since 2018 the FCA has required issuers to act when a customer has paid more in interest, fees and charges than principal over 18 months. At that point the issuer must contact you and prompt you to increase repayments.
At 36 months, if the pattern continues, the issuer must offer ways to repay the balance more quickly — typically over three to four years — and if you cannot afford that, they must offer forbearance, which can include reducing or waiving interest and charges. Persistent non-response can result in the card being suspended.
These letters are frequently ignored because they read like marketing. They are not: they are a regulatory trigger, and engaging with them opens options — including interest being reduced — that are not available if you do nothing. If you have had one, the calculator above will show you why.
Avalanche costs less; snowball gets finished
With more than one debt, avalanche targets the highest APR and always costs less in total interest. Snowball targets the smallest balance and clears an individual debt sooner. The calculator runs both and shows the real gap for your numbers instead of asserting which is better.
On a typical mix of a card, a store card and a loan, the difference is often a few hundred pounds, while snowball clears its first debt within a few months against a year or more for avalanche.
If the rates are close, take snowball and the momentum. If a store card is sitting at 29.9% while everything else is at 7%, take avalanche — the gap is too big to trade away.
Balance transfers, and free help if the numbers do not work
A 0% balance transfer is genuinely useful: every pound goes to the balance for the promotional period. Expect a transfer fee of around 2% to 4%, which is worth paying if the term is long enough. On £4,000 a 3% fee is £120 against roughly £950 a year in interest at 23.9%.
Divide the balance by the number of 0% months and pay that. Arriving at the end of the promotional period with most of the balance intact simply relocates the problem, minus the fee. And be honest about whether the emptied card will stay empty — a substantial share of transfers end with two balances rather than one.
If no realistic repayment clears the balance, the right next step is free debt advice rather than a calculator. StepChange, National Debtline and Citizens Advice are all free, independent and confidential. They can explain a Debt Management Plan, an Individual Voluntary Arrangement, a Debt Relief Order and — in England and Wales — Breathing Space, which freezes interest and enforcement for sixty days. Any organisation charging a large upfront fee for the same thing is selling you something you can get free.
Assumptions and sources
- Payoff schedules
- Both schedules walked month by month. Verified in tools/test/finance.mjs against independently calculated payoff tables.
- Minimum repayment rule
- Since 2011 UK issuers must charge at least interest, fees and charges plus 1% of the balance. Your own formula is on your statement. checked 2026-08
- Persistent debt rules
- FCA credit card market study remedies, in force from 2018 — intervention at 18, 27 and 36 months. checked 2026-08
- Free debt advice
- StepChange, National Debtline and Citizens Advice provide free independent advice. Breathing Space (Debt Respite Scheme) applies in England and Wales. checked 2026-08