Debt Payoff Calculator
Find your exact debt-free date. Compare avalanche vs snowball strategies and see how much interest you can save.
At minimum payments, a $10,000 credit card balance at 20% APR takes over 20 years to clear and costs nearly $25,000 total. One strategy change fixes this.
25%
Average credit card APR in 2024 — paying only minimums doubles your actual cost
$7,951
Average American credit card balance — at 20% APR with minimums, that takes 20+ years to pay off
20yrs
How long minimum payments can keep you in debt on a $10,000 credit card balance
Two strategies. One goal: debt freedom.
The right approach depends on your psychology as much as the math.
Avalanche: the math-optimal method
Target your highest-rate debt first. Every dollar applied to a 22% APR card does more work than any dollar applied to a 6% car loan. Over years, this difference in interest compounds massively in your favour.
Snowball: the psychology-driven method
Small wins matter. Eliminating a debt completely triggers a dopamine response that keeps motivation high. Studies show many people who use the snowball method complete their debt payoff — even if they pay slightly more total interest.
The freed-payment snowball effect
When you eliminate one debt, that minimum payment doesn't go back into daily spending — it attacks the next debt. This growing 'snowball' of freed payments accelerates payoff dramatically as you progress. The last few debts get eliminated very quickly.
How the Debt Payoff Calculator Works
Formula
Monthly interest = Balance × (APR / 12 / 100)
Principal paid = Payment − Monthly interest
Avalanche: Sort debts by interest rate (highest first)
Snowball: Sort debts by balance (lowest first)
Freed minimum: When a debt reaches $0, its minimum payment
rolls into the next debt's payment automatically.
Interest saved = Minimum-only total interest − Strategy total interestAdd your debts
Enter each debt: name, balance, interest rate, and minimum payment.
Choose a strategy
Avalanche saves the most money. Snowball provides the most motivation.
Set extra payments
Even $50/month extra makes a dramatic difference on high-interest debt.
Add a lump sum
Got a tax refund or bonus? Apply it immediately for maximum interest savings.
See your debt-free date
The exact month and year you'll be completely debt-free, with interest saved.
This calculator runs a full month-by-month simulation for both your chosen strategy and minimum-only payments, so you can see exactly what you save. The burn-down chart shows your declining balance over time.
The 'freed minimum' mechanic is key: every time you eliminate one debt, that payment doesn't disappear — it gets added to the next debt's attack. This is why the final debts get eliminated so fast, and why starting is the hardest and most important step.
Frequently Asked Questions
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