Money & finance
Debt payoff calculator
Estimate repayment across several debts using your balances, rates and monthly budget. Compare payoff priorities and see when each balance could reach zero.
Works locally in your browser
How this tool works
A debt payoff plan can show how minimum payments and an additional monthly amount interact across several balances. This calculator models the balances together so money freed by one payoff can move to the next debt.
Calculations run locally in your browser. Optional debt names are page-only labels and are not included in the URL, analytics, or exported schedule.
Inputs and definitions
- Balance is the amount owed at the start of the plan.
- Annual rate is the fixed nominal percentage used to derive a monthly rate.
- Minimum payment is the monthly amount allocated to that debt before the selected priority receives the remaining budget.
- Additional monthly payment is added to the initial total of all minimum payments and kept in the plan after a debt is cleared.
Methodology
monthly budget = initial minimum payments + additional paymentEach month, the model adds one twelfth of the nominal annual interest to each rounded opening balance. It then applies every active minimum payment and sends the remaining fixed budget through the selected priority. If one debt closes mid-month, the unused amount immediately cascades to the next target.
Avalanche ranks active debts by highest annual rate, then lower balance. Snowball ranks by lowest current balance, then higher rate. Original order keeps the entered order, while custom order follows the order you set with the move controls.
Assumptions
- Rates and minimum payments remain fixed, no new purchases or advances are added, and every modeled payment is made monthly and on time.
- Interest is modeled monthly before payments; the first payment occurs one calendar month after the plan start date.
- The initial payment budget remains fixed, so minimum payments freed by a cleared balance roll into the other debts.
Worked examples
Roll a freed minimum into the remaining debt
Enter two zero-interest balances of 100 and 200, each with a minimum payment of 50, and use original order with no additional payment.
Keep the initial budget fixed
The two minimums establish a monthly budget of 100. The first month sends 50 to each balance.
Roll the cleared payment forward
The first balance is cleared in month two. From month three, its 50 payment is added to the payment for the second balance, keeping the total monthly budget at 100.
The 300 total balance is paid in three months with zero interest, and the final modeled payment date is 30 April 2024 for a 31 January 2024 start.
Detect a budget that does not reduce principal
Enter a balance of 1,000 at 12% with a monthly minimum of 10 and no additional payment.
Calculate first-month interest
One month of interest is 10 at a 12% nominal annual rate, exactly matching the payment budget.
The model flags the plan before generating a schedule and shows that at least 0.01 more per month is needed to exceed first-month interest at two-decimal precision.
Limitations and common mistakes
This result is an estimate, not financial advice, a settlement proposal, or a creditor statement. It does not model daily interest, variable rates, changing minimum formulas, promotional periods, penalties, fees, missed payments, new borrowing, taxes, or negotiated terms.
A plan is flagged immediately when its fixed monthly budget does not exceed modeled first-month interest. A slowly declining plan is also stopped after 1,200 months; that limit is a computational boundary, not a prediction that the debt can never be repaid.
Frequently asked questions
What is the debt avalanche method?
After all minimums, avalanche directs the remaining budget to the active debt with the highest interest rate. Under the calculator's fixed assumptions, this generally minimizes modeled interest among the compared priorities.
What is the debt snowball method?
After all minimums, snowball directs the remaining budget to the smallest active balance. It can create earlier balance-closure milestones, although the model may show more interest than avalanche.
Why does the calculator keep the monthly budget fixed?
The initial minimum payments plus the additional amount define one budget. Keeping it fixed models rolling a cleared debt's former payment into the remaining balances instead of reducing monthly outflow.
Why might a creditor's payoff date differ?
Creditors may accrue interest daily, recalculate minimums, apply payments differently, charge fees, or use statement and due dates that do not match this monthly model. Confirm actual payoff figures directly.
Sources
- How to reduce your debt — Consumer Financial Protection Bureau (accessed )
- Using Credit Cards and Disputing Charges — Federal Trade Commission (accessed )
Method and content record
The method, examples and limitations describe how this tool works. Recorded checks do not establish independent professional review.
Record attribution, date and versions
Record attribution: ToolsOrigin calculation review; introduction guidance checked by Codex.
Record date: .
Content version 1.0.2. Engine version 1.0.0.