Debt Payoff Calculator
Create a strategic debt payoff plan with our calculator. Compare avalanche vs snowball methods and see how extra payments can save you thousands in interest.
Debt Information
Your Debts
Debt #1
Additional amount you can pay monthly toward debt
Debt Payoff Results
Strategy Comparison
Current Debt Summary
Payoff Order
Avalanche MethodDebt Payoff Strategies Explained
Debt Avalanche Method
The avalanche method prioritizes debts with the highest interest rates first. This approach minimizes total interest paid over time.
How it works:
- Pay minimum payments on all debts
- Apply extra payments to highest interest rate debt
- Once paid off, move to next highest rate debt
- Repeat until all debts are eliminated
Debt Snowball Method
The snowball method targets the smallest balances first, providing psychological wins and building momentum through quick victories.
How it works:
- Pay minimum payments on all debts
- Apply extra payments to smallest balance debt
- Once paid off, move to next smallest balance
- Repeat until all debts are eliminated
Tips for Faster Debt Payoff
Increase Your Income
- • Take on a part-time job or freelance work
- • Sell items you no longer need
- • Ask for a raise or seek higher-paying employment
- • Start a side business or monetize a hobby
Reduce Your Expenses
- • Create and stick to a detailed budget
- • Cancel unused subscriptions and memberships
- • Cook at home instead of dining out
- • Find cheaper alternatives for utilities and services
Negotiate with Creditors
- • Request lower interest rates on credit cards
- • Ask about hardship programs or payment plans
- • Consider debt consolidation options
- • Negotiate settlements for accounts in collections
Use Windfalls Wisely
- • Apply tax refunds directly to debt
- • Use bonuses and raises for debt payoff
- • Put gifts of money toward debt elimination
- • Resist lifestyle inflation when income increases
Important Considerations
Emergency Fund First: Before aggressively paying down debt, ensure you have a small emergency fund ($1,000) to avoid creating new debt during unexpected expenses.
High-Interest Debt Priority: Focus on eliminating high-interest debt (typically credit cards) before low-interest debt like mortgages or student loans.
Don't Close Credit Cards: After paying off credit cards, keep them open to maintain your credit utilization ratio and credit history length.
Consider Professional Help: If you're overwhelmed by debt, consider speaking with a nonprofit credit counseling agency for personalized guidance.
Related Calculators
Interest Calculator
Calculate compound interest on debt
Budget Calculator
Plan your spending and debt payments
Loan Calculator
Calculate loan payments and terms