Enter your debts
Add up to three debts. The calculator assumes interest compounds monthly and payments are applied once per month. Move the extra payment slider to instantly see your payoff date change.
Build a simple payoff plan in under a minute. Enter up to three debts (balance, APR, minimum payment), choose a strategy (Snowball or Avalanche), and add an extra monthly payment. You’ll get an estimated payoff date, total interest, and a month‑by‑month snapshot so you can see what changes actually move the finish line.
Add up to three debts. The calculator assumes interest compounds monthly and payments are applied once per month. Move the extra payment slider to instantly see your payoff date change.
The whole point of this Debt Payoff Advisor is to turn “I should pay this off someday” into a concrete timeline you can act on. It does that by simulating your debts month by month. Each month has three simple steps: interest accrues, minimum payments are applied, then any extra money you choose is targeted to one debt based on the strategy you pick. When one debt reaches $0, its minimum payment is freed up and automatically rolled into the next target debt, which is why payoff plans often feel like they speed up once you get traction.
Step 1: Convert APR to a monthly rate
APR is an annual percentage rate. The calculator converts it to a monthly rate using rm = (APR ÷ 100) ÷ 12. So a 24% APR becomes 0.24/12 ≈ 0.02 per month. Real lenders may use daily interest or statement cycles, but monthly compounding is a practical, easy-to-understand approximation for planning.
Step 2: Add monthly interest
Each month, each active debt accrues interest: interest = balance × rm. The interest is added to the balance before payments. This is why high-APR debt can feel “sticky”: part of your payment is just keeping the balance from growing rather than reducing principal.
Step 3: Apply payments (minimums first, then extra)
Minimum payments are applied to every active debt first. Then your extra payment (the slider) is applied to the chosen target debt. If your extra payment would exceed the remaining balance, the leftover amount rolls to the next target immediately. After a debt is paid off, its minimum payment rolls into your “extra pool” next month, keeping your total monthly outflow steady and accelerating payoff.
Snowball vs Avalanche targeting
Avalanche targets the highest APR first (often best for minimizing interest). Snowball targets the smallest balance first (often best for motivation and quick wins). In the real world, the “best” method is the one you can stick with consistently. The calculator runs both strategies behind the scenes so you can compare.
What the results mean
You’ll see (1) months to payoff and an estimated payoff month/year, (2) estimated total interest, and (3) a 12‑month snapshot so the plan feels real. The most valuable use is scenario testing: move the extra payment slider by $25 increments and watch the finish line change. That instant feedback is what turns planning into action.
This tool is built for real-life decision making, not perfect spreadsheets. Here are three patterns it helps you see quickly, plus answers to common questions.
Example 1: Small extra payments create outsized impact
If you have a high-APR credit card, adding even $25–$100/month can reduce payoff time dramatically. Why? Because extra money goes straight to principal, which reduces future interest. Think of it as buying future interest avoidance every month. The slider exists to help you find an extra payment that is sustainable, not heroic.
Example 2: Snowball can beat Avalanche in practice
Avalanche usually wins mathematically. But if motivation is the bottleneck, Snowball’s quick wins can keep you consistent. If Snowball helps you stick with the plan for 12 months, it may produce better real-world outcomes than an “optimal” strategy you abandon after three months.
Example 3: The rolling-payment effect accelerates payoff
When one debt is gone, its minimum payment becomes available. If you keep paying the same total amount each month, your payoff speed increases automatically. This tool models that roll-forward so you can see how momentum builds.
FAQ: Is this calculator exact?
It’s an estimate. Many lenders accrue interest daily, minimums can change, and fees can apply. Monthly compounding gives a clear, fast plan model that’s great for comparison and goal setting.
FAQ: What about promo 0% APR cards?
Enter 0% while the promo lasts, but also run a scenario using the post‑promo APR so you understand the risk if the balance doesn’t clear before the promo ends.
FAQ: Does this include fees or penalties?
No. Late fees, transfer fees, and penalties vary. If your debt has known fees, you can approximate by adding them to the balance.
FAQ: What’s the fastest lever to improve payoff date?
Usually: increase extra payment, lower APR (refi / balance transfer / negotiation), then apply lump sums. The slider and lump sum inputs exist to show you which lever moves your finish line most.
FAQ: How should I use this weekly?
Treat it like a dashboard. Update balances monthly (or when you get statements) and re-run the plan. If the payoff date slips, you’ll see it early and can adjust spending, payments, or strategy.
Formula breakdown (plain English)
For each debt each month: compute monthly rate rm = (APR/100)/12, add interest = balance×rm, subtract minimum payment (capped at remaining balance), then apply extra payment to the target debt. Repeat until all balances reach $0. The number of months simulated is the payoff time; adding that to today yields the payoff date.
Educational note: This tool is not financial advice. If you’re considering consolidation, bankruptcy, or major changes to retirement plans, a qualified professional can help you evaluate tradeoffs.