Debt Payoff Calculator
Create a comprehensive debt payoff plan. Add all your debts, choose a payoff strategy, and see how long it will take to become debt-free with different payment amounts.
Debt Snowball: Pay minimums on all debts, extra to smallest balance
Debt Avalanche: Pay minimums on all debts, extra to highest interest rate
Debt 1
Payment Information
Payoff Summary
Debt-by-Debt Results
Enter debt information and click calculate to see results
Monthly Payment Breakdown
Understanding Debt Payoff Strategies
Becoming debt-free requires a solid plan. This calculator helps you create a comprehensive debt payoff strategy by considering all your debts, minimum payments, and extra payment amounts.
Debt Snowball vs Debt Avalanche
Debt Snowball Method
- Focus on smallest balance first
- Build momentum with quick wins
- Psychologically motivating
- Best for behavioral change
- May cost more in total interest
Debt Avalanche Method
- Focus on highest interest rate first
- Mathematically optimal
- Maximum interest savings
- Best for financial efficiency
- May take longer for first payoff
Types of Consumer Debt
| Debt Type | Typical Rate | Typical Term | Payoff Priority |
|---|---|---|---|
| Credit Cards | 15-25% | Revolving | High (highest rates) |
| Personal Loans | 6-36% | 1-7 years | High (high rates) |
| Student Loans | 3-8% | 10-30 years | Medium (lower rates) |
| Auto Loans | 3-10% | 3-7 years | Medium (moderate rates) |
| Mortgages | 3-7% | 15-30 years | Low (longest term) |
Creating Your Debt Payoff Plan
8 Steps to Debt Freedom
Step 1: List All Debts
Gather all debt information including balances, rates, and minimum payments
Step 2: Choose Strategy
Decide between snowball or avalanche based on your personality
Step 3: Calculate Minimums
Determine total minimum payments required each month
Step 4: Find Extra Money
Create a budget to find money for extra payments
Step 5: Stop New Debt
Cut up credit cards and avoid new debt while paying off existing
Step 6: Make Payments
Pay minimums on all debts, extra to priority debt
Step 7: Track Progress
Monitor payoff progress and celebrate milestones
Step 8: Stay Motivated
Remember your goals and the freedom of being debt-free
Debt Payoff Example
$25,000 Total Debt Across Multiple Accounts
| Strategy | Payoff Time | Total Interest | Total Paid |
|---|---|---|---|
| Minimum Payments Only | 15+ years | $18,500 | $43,500 |
| Snowball + $400 extra | 4 years | $5,200 | $30,200 |
| Avalanche + $400 extra | 4 years | $4,800 | $29,800 |
Common Debt Payoff Mistakes
What Not to Do
- Paying only minimums
- Taking on new debt
- Skipping payments
- Not having a plan
- Giving up too soon
Smart Strategies
- Automate payments
- Cut unnecessary expenses
- Increase income if possible
- Celebrate small wins
- Reassess plan quarterly
Key Takeaways for Debt Payoff
- Choose a debt payoff strategy that matches your personality and financial situation
- Always pay at least the minimum on all debts to avoid fees and penalties
- Any extra payment, no matter how small, will reduce your payoff time and total interest
- Stop accumulating new debt while paying off existing balances
- Track your progress and celebrate each debt paid off completely
- Consider debt consolidation or balance transfers for lower interest rates
- Build an emergency fund to avoid going back into debt
- Be patient - becoming debt-free is a marathon, not a sprint