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RomeoStevens comments on The Zeroth Skillset - Less Wrong Discussion
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A heuristic is a fuzzy set of principles that are correlated with the outcomes you want. An algorithm is a set of directions that give you the outcome you want. When I say "avoiding poor people is a heuristic" I mean that it is the high level abstraction of a bunch of low level behaviors in various situations.
Something can be an algorithm despite not necessarily giving you exactly the outcome you want. Hence approximation algorithms and probabilistic algorithms.
Edit: the boundaries between algorithms and heuristics are complicated. Colloquial usage referring to heuristics as something like "rules of thumb" and algorithms as "a set of directions" is what was intended.