Wondering what the best strategy is for clearing your credit card debt? The credit card debt optimiser helps you compare different repayment methods, showing you the fastest way to become debt-free and save the most money on interest.
What the credit card debt optimiser is
The credit card debt optimiser is an interactive tool that simulates and ranks six repayment strategies, including the popular Avalanche and Snowball methods. It allows you to see which approach will clear your debt fastest and save you the most money, helping you choose the best option for your circumstances.
Your data is private
We never store or transmit your financial information. All calculations happen directly in your browser, ensuring nothing ever leaves your device.
Independent & unbiased
This tool is 100% independent and we created it without any funding or influence from banks, so you can be confident the results are unbiased.
Disclaimer about the credit card debt optimiser
We have carefully tested this tool to ensure its calculations are accurate. However, we provide the results for illustrative purposes only and they come with no guarantee. The information on this page does not constitute financial advice. Before making any financial decisions, we strongly recommend that you consult a qualified financial advisor.
How to use the credit card debt optimiser
Getting started is simple. Follow these steps to find your optimal repayment plan.
1. Enter your details
For each of your credit cards, use the ‘Add Card’ button and fill in the details:
- Balance: The total outstanding amount you owe on the card.
- APR (%): The Annual Percentage Rate. This is the yearly interest charge, which you can find on your credit card statement.
If you click the ‘Advanced’ button, you can also specify:
- Min % and Min £/$/€: These fields define your card’s minimum monthly payment. Your required payment is usually the greater of a percentage of your balance (e.g., 2%) or a fixed minimum amount (e.g., £5). You can find these details on your statement.
You can add as many cards as you need, and remove them by clicking the ‘X’ button on each row.
2. Set your monthly repayment
In the ‘Monthly repayment’ box, enter the total amount you can afford to pay towards all your credit cards each month.
You can adjust this figure at any time to see how changing your budget affects the results. You can either type a number directly into the box or use the slider to explore different amounts quickly.
3. Add a balance transfer card (optional)
A balance transfer, sometimes called consolidation, can be a powerful strategy. It allows you to move high-interest debts to a new card with a lower promotional interest rate. This feature lets you simulate that scenario. If you are considering this, click the ‘Add Transfer Card’ button.
The tool will automatically set the balance by summing your other debts, so your only task is to enter the APR for the new card (and its minimum repayment terms if you have the ‘Advanced’ view toggled on).
When you click ‘Calculate’, a dedicated ‘Balance Transfer’ scenario will appear in your results, allowing you to see exactly how much you could save compared to other strategies.
4. Click ‘Calculate’ to see your results
Once you have entered your information, click the ‘Calculate’ button. The tool will simulate the different repayment strategies and rank them, showing you which plan clears your debt the fastest and saves you the most in interest.
A note on currency
You can use the currency selector to change the symbols (£, $, €) displayed in the tool. This is a visual change and does not affect the calculations.
Credit card debt repayment strategies
The optimiser simulates six different repayment strategies to find the best one for you. Here’s a breakdown of how each one works.
The Avalanche method (Highest APR first)
You focus all extra repayments on the card with the highest APR, whilst making minimum payments on all others. Once that card is cleared, you move to the card with the next highest APR, and so on.
Mathematically, this is the most efficient strategy, saving you the most money in interest and clearing your debt in the shortest possible time.
The Snowball method (Lowest balance first)
You focus all extra repayments on the card with the smallest balance first, regardless of its interest rate. You then move to the card with the second smallest balance, and so on.
This method is designed for motivation, as clearing smaller debts quickly provides psychological wins that help you build momentum.
The Motivator method (Hybrid)
This strategy starts like the Snowball method. Once your first card is paid off, it switches to the more efficient Avalanche method.
It aims to provide the best of both worlds: an early, motivating win, followed by the most mathematically sound approach.
Balance Transfer (Consolidation)
This involves moving all your existing card balances onto a single new card, ideally one with a very low or 0% introductory APR.
If done right, consolidation simplifies your payments and can drastically reduce the interest you’re charged.
Reverse Snowball (Highest balance first)
This method focuses on tackling the card with the largest balance first, then moves on to the card with the second largest balance, and so on.
This strategy is often less effective and we include it primarily for comparison purposes.
The Snail (Lowest APR first)
This method involves paying off the card with the lowest interest rate first.
It is mathematically the least effective strategy and we include it to serve as a baseline, showing you the maximum cost and time it could take to clear your debt.
The credit card debt optimiser
| Card name | Balance | APR | Min % | Min £ |
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How the credit card debt optimiser works
This tool runs a month-by-month simulation to project how your debt will decrease over time. For full transparency, here’s a breakdown of the process.
How each month is simulated
- Minimum payments calculation. At the start of the simulated month, the tool calculates the minimum payment required for each card. This is defined as the greater of a percentage of the balance or a fixed floor amount (e.g., 2% or £5). You can view and edit these specific terms by toggling the ‘Advanced’ button.
- Interest calculation. The tool calculates and adds interest for the month to each card’s balance.
- Repayment. The tool first allocates your budget to cover the minimum payment on every card. If your budget is too low to cover all the minimums, it’s distributed proportionally.
- Extra funds allocation. The tool then applies any remaining money from your budget as an extra payment to a single target card, according to the strategy being simulated (e.g., the card with the highest APR for the Avalanche method).
- Fund redirection. Once a card’s balance is cleared, the tool redirects all funds that were going to it to the next card in the sequence.
Assumptions & simplifications
To provide a clear and fast result, this calculator is a close estimate and makes a few simplifying assumptions:
- Interest calculation: For maximum accuracy, this tool’s calculations are based on the Effective Annual Rate (the true annual cost once monthly compounding is included). This can differ slightly from the simpler Nominal APR (the headline rate divided by 12) that some banks use, which is why our figures are a very close estimate.
- No rounding: In real life, banks round interest to the nearest penny/cent each month. This tool uses precise decimals throughout the simulation to maintain accuracy, which can cause very small differences in the final totals.
- Time limit: The simulation runs for a maximum of 600 months (50 years). If the debt is not projected to be cleared by then, the calculation stops.
Frequently Asked Questions
- How will these strategies affect my credit score? Consistently paying off debt is one of the best things you can do for your credit score in the long term. In the short term, closing old credit card accounts can sometimes cause a temporary dip in your score, but this is usually minor compared to the positive impact of reducing your overall debt.
- What if I can’t afford my minimum payments? This tool assumes you can meet your minimum payments. If you are in a situation where you cannot, you should contact your lenders immediately. They have a duty to help you and may be able to offer a temporary solution, like a reduced payment plan. Don’t ignore the problem. Speak to them and a debt charity like National Debtline as soon as possible.
- Should I use my emergency fund to pay for my credit card debt? It is a balancing act. Whilst clearing expensive credit card debt is a priority, leaving yourself with no emergency savings can lead to more debt if an unexpected cost arises. A common strategy is to use a portion of the fund to pay down the debt while keeping a smaller buffer for safety. For a deeper look, please check out our ultimate emergency fund guide.
Credit card debt optimiser: key considerations
- This tool is not financial advice. The results are provided for informational purposes only. Before making any financial decisions, you should always consult a qualified financial advisor who can provide guidance tailored to your personal situation.
- Your privacy is protected. All the data you enter into this tool is processed directly in your browser. It is never stored or sent to us, ensuring your financial information remains yours alone.
- Consider all of your debts. This calculator focuses on credit card debt. If you have other debts, such as personal loans or car finance, it’s important to consider your total financial situation when creating a repayment plan.
- If you’re struggling with debt, please seek help. Managing debt can be overwhelming. Reputable UK charities like National Debtline offer free, impartial, and confidential support.
- What’s next? If this is your first time here, a great next step is to take our Finance Health Quiz. It will give you personalised recommendations for articles that can help you on your financial journey. You can also check out our other tools, such as our emergency fund calculator or our early retirement calculator.
- Found a bug or have a suggestion? We would love to hear from you. Please send us a message here.