Debt Payoff Calculator
Enter your balance, annual interest rate and monthly payment.
Important note
This page models one balance at a time. If you carry several debts, the order you attack them in changes the total interest: the avalanche method (extra money to the highest APR first) is always the cheapest, while the snowball method (smallest balance first) trades a little extra interest for early wins that keep people going. The mini-example under “How this calculator works” puts dollar figures on the difference.
How this calculator works
This calculator simulates your debt month by month, like a credit card statement. It converts your APR to a monthly rate (r = APR / 100 / 12), then each month charges interest = balance x r, applies your payment — the "Monthly payment" and "Extra monthly payment" fields are simply added — and reduces the balance by payment minus interest. Monthly principal repaid can never exceed the remaining balance or drop below zero.
The simulation runs until the balance hits zero or 1,200 months pass. "Estimated interest" sums every month's interest charge; "Estimated total paid" is the original balance plus that interest. If a payment cannot cover the month's interest, principal repaid is zero and the simulation stops early — the "long-run limit" the page warns about, i.e. the debt never shrinks.
What the model leaves out: fees, new purchases, and rate changes. It assumes one fixed balance declining at one fixed APR — which fits a "stop spending and pay it down" plan better than an active card you keep using.
Avalanche vs snowball: what the order is worth
Run two identical $2,000 balances through this calculator at $200 a month. At 19.99% APR the balance takes 12 months and costs $205.97 of interest; at 9.99% APR it clears in 11 months and costs $97.07. Same debt, same payment — the higher-rate balance costs $108.90 more, which is why every extra dollar should go to the highest APR first (avalanche), while you pay the minimums on the rest. Snowball — clearing the smallest balance first regardless of rate — costs more on paper, but the quick win frees up a payment sooner, and some people stick with it longer. Either beats spreading extra money evenly across all your debts, which is the slowest route of all.
Worked example: $5,000 at 19.99% APR, $200/month
Enter a $5,000 balance, 19.99% APR, a $200 monthly payment and no extra payment. The monthly rate is 19.99% / 12 = 1.6658%, so the first month's interest is $5,000 x 1.6658% = $83.29; $116.71 of the $200 goes to principal and the balance falls to about $4,883.29. Repeating monthly, the balance hits zero after 33 months with $1,521.02 of interest — $6,521.02 altogether on a $5,000 debt.
Add $100 to the extra-payment field ($300/month) and the simulation finishes in 20 months with $906.25 of interest: 13 fewer months and $614.77 less interest — from an extra $100 a month. That pair of numbers is the whole argument for paying more than the minimum.
Practical tips
- Send every extra dollar to your highest-rate debt first (avalanche) — run each balance here separately and put the extra payment where the rate is highest.
- Stop adding new charges to the card you are paying down — the simulation assumes a frozen balance.
- Automate the payment for the day after payday — willpower-based extra payments usually do not happen.
Frequently asked questions
Should I use the avalanche or the snowball method?
Avalanche means paying minimums on everything and directing all extra cash at the highest interest rate — it minimizes total interest mathematically. Snowball means attacking the smallest balance first for quick wins and motivation, even if it costs a little more interest. This calculator models one balance at a time — run each debt through it separately, then assign your extra payment to whichever strategy you will actually stick with.
Why does the calculator stop at 1,200 months?
1,200 months (100 years) is a guard rail, not a prediction. If your payment barely covers the monthly interest, the balance shrinks so slowly the simulation would run almost forever — so the tool stops and reports the long-run limit instead. Treat that as a signal to raise your payment: a $5,000 balance at 19.99% accrues about $83.29 of interest in the first month alone.
Does this include fees or new purchases?
No — one fixed balance at a fixed APR, with no annual fees, late fees, or new charges. As a rough adjustment, add the fee to the balance field before calculating.
Why is the monthly rate the APR divided by 12?
That is the standard estimating convention for payoff calculators. Canadian credit cards technically accrue interest daily, so a real statement can differ by a few dollars — but APR / 12 is close enough to plan a payoff schedule with.
What if my payment is too low?
If the payment does not exceed monthly interest, the balance may not decline. This tool reports a long-run limit in that case.
Does this include fees?
No. Enter fees separately if you want to approximate their effect.