Debt Payoff Calculator
Calculate your debt payoff timeline and see how extra payments can accelerate your path to becoming debt-free.
How to Use the Debt Payoff Calculator
- Enter Your Debts: Add each debt with balance, interest rate, and minimum payment
- Set Extra Payment: Enter any additional amount you can pay toward debt monthly
- Choose Strategy: Compare debt avalanche (highest interest first) vs snowball (smallest balance first)
- Review Timeline: See payoff order, timeline, and total interest for each method
- Track Progress: Use the results to create your debt elimination plan
- Adjust as Needed: Update payments and balances as you make progress
Calculation Examples
Debt Avalanche Method
Debt Snowball Method
Strategy Comparison:
- Debt Avalanche: Saves more money by targeting highest interest rates first
- Debt Snowball: Builds momentum and motivation with quick wins
- Extra Payments: Any additional payments dramatically reduce payoff time
- Choose Your Method: Pick the strategy you're most likely to stick with
Frequently Asked Questions
Which debt payoff method is better?
Debt avalanche saves more money mathematically, but debt snowball provides psychological benefits. Choose the method you're most likely to stick with long-term.
Should I pay off debt or invest?
Generally, pay off high-interest debt (above 7-8%) before investing. For lower interest rates, consider investing while making minimum payments.
How much extra should I pay toward debt?
Pay as much extra as your budget allows while maintaining an emergency fund. Even an extra $50-100 per month makes a significant difference.
Should I consolidate my debts?
Debt consolidation can be helpful if you qualify for a lower interest rate. Compare the new rate and terms with your current debts to ensure it saves money.
What about minimum payments?
Always make at least the minimum payment on all debts to avoid late fees and credit damage. Never skip minimum payments to make extra payments elsewhere.
How do I stay motivated during debt payoff?
Track your progress visually, celebrate milestones, consider the debt snowball method for quick wins, and remember your why - the financial freedom you're working toward.
Understanding Debt Payoff Strategies
Debt Avalanche Method
How It Works
Pay minimums on all debts, then put extra money toward the debt with the highest interest rate
Best For
People motivated by saving money and mathematical optimization
Advantages
Saves the most money in interest payments over time
Debt Snowball Method
How It Works
Pay minimums on all debts, then put extra money toward the debt with the smallest balance
Best For
People who need motivation and psychological wins to stay on track
Advantages
Provides quick wins and builds momentum for long-term success
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