Debt Payoff Calculator

Build a payoff plan and see how fast you could become debt-free using snowball or avalanche strategies.

  • Free to use
  • No account required
  • Results shown instantly
Debt 1
$
%
$
Debt 2
$
%
$
$

Applied to your priority debt each month.

Payoff Strategy

Add your debts and click calculate to see your payoff plan.

Education

How Debt Payoff Planning Works

A debt payoff plan organizes multiple balances into a single repayment strategy, applying extra money to one priority debt at a time while keeping minimums on the rest.

Each month, interest accrues on every balance. You pay the minimum on all debts, then direct any extra money to your priority debt. When that debt is paid off, its payment budget rolls into the next debt — accelerating payoff without increasing your total monthly outlay.

Debt Snowball Method

The snowball method targets the smallest balance first regardless of interest rate. Paying off a debt quickly can build momentum and motivation, even if it doesn't always minimize total interest.

Debt Avalanche Method

The avalanche method targets the highest interest rate first. Because it attacks the most expensive debt, it usually saves the most interest over the life of the plan — though early wins may come slower than with the snowball.

Snowball vs. Avalanche Comparison

The avalanche generally minimizes interest; the snowball can be easier to stick with because of early, visible progress. The best choice is the one you'll follow through to completion. This calculator lets you compare both strategies with the same debts.

Why Interest Rates Matter

Higher-rate balances grow faster, so carrying them longer costs more. Directing extra money to high-rate debt first reduces the total interest paid — the core idea behind the avalanche method.

How Extra Payments Accelerate Debt Payoff

Any amount above the minimum goes straight to principal on your priority debt, lowering the balance and the interest that accrues on it every month after. Even a modest extra payment can shorten your debt-free date by months or years.

Rolling Payments Into the Next Debt

When a debt is paid off, the money you were paying on it doesn't disappear — it's added to the next priority debt. This "rollover" keeps your total monthly debt payment constant while accelerating each remaining balance.

What Happens When Payments Are Too Low?

If a minimum payment doesn't cover the monthly interest, the balance grows rather than shrinks — called negative amortization. The calculator detects this and warns you instead of running an endless calculation.

Methodology

Debt Payoff Calculator Methodology

How MoneyMetric HQ models multi-debt repayment.

Monthly interest. Each month, interest = balance × (annual rate ÷ 12) for every active debt.

Minimum payments. Every debt receives at least its minimum payment. The extra monthly amount (if any) is applied to the priority debt — highest rate for avalanche, smallest balance for snowball.

Allocation. Extra money goes to one priority debt at a time. When that debt is paid off, its full payment budget (minimum + any extra) rolls into the next priority debt.

Final payment. The final payment on each debt is adjusted so the balance reaches exactly $0 and is never overpaid.

Totals. Total interest and total paid are summed across all debts from the month-by-month simulation. The debt-free date is the month the last balance reaches zero.

Limits. If a minimum payment cannot cover accruing interest, the calculator warns rather than simulating an impossible payoff.

Rounding. MoneyMetric HQ performs calculations using full numerical precision internally and rounds values only for display.

See our full MoneyMetric HQ Methodology page for more.

Example

Debt Payoff Example

An illustrative three-debt scenario calculated by the engine.

Debt A — Credit Card

$5,000 · 22% APR · $150/mo

Debt B — Credit Card

$2,000 · 12% APR · $80/mo

Debt C — Store Card

$1,000 · 18% APR · $50/mo

Extra Monthly Payment

$200

With a $200 extra monthly payment, the avalanche method targets Debt A first (highest rate), then rolls its payment into the next priority debt. The snowball method targets Debt C first (smallest balance). Use the calculator with your own balances to see exact payoff dates, total interest, and the difference between strategies. These figures are illustrative and assume no new borrowing.

FAQ

Debt Payoff Calculator FAQs

What is the debt snowball method?

The snowball method pays off the smallest balance first while making minimums on the rest. Quick early wins can build motivation, though it may not minimize total interest.

What is the debt avalanche method?

The avalanche method pays off the highest-interest debt first. Because it attacks the most expensive balance, it usually saves the most interest over the life of the plan.

Which strategy usually saves more interest?

The avalanche typically saves more interest because it prioritizes the highest rate. The snowball can be easier to sustain because of faster visible progress. The best method is the one you'll complete.

Can I combine multiple debts?

Yes. Add as many debts as you like — each with its own balance, rate, and minimum payment. The calculator simulates them together.

How are extra payments allocated?

Extra money goes to your priority debt (highest rate for avalanche, smallest balance for snowball) after all minimums are met. It reduces that debt's principal faster.

What happens when one debt is paid off?

Its payment budget — minimum plus any extra — rolls into the next priority debt. Your total monthly debt payment stays the same while each remaining balance is paid faster.

What if my payment does not cover interest?

If a minimum payment is less than the monthly interest, the balance grows. The calculator detects this and warns you rather than running an endless calculation.

Does this calculator negotiate or consolidate debt?

No. It estimates a payoff plan based on the numbers you enter. It does not contact creditors, negotiate rates, or consolidate loans.

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MoneyMetric HQ calculators are provided for educational and informational purposes. Results are estimates and may differ from lender, loan-servicer or other financial calculations because of loan terms, payment timing, rounding, fees, taxes, insurance and other factors. MoneyMetric HQ does not provide personalized financial, investment, tax, legal or credit advice. See our Methodology, Financial Disclaimer, and Privacy Policy.