Debt Payoff Calculator

This frustrating situation happens because of how credit card interest works. Each month, interest is calculated on your average daily balance. When you make a payment, it's split between interest charges and principal (what you actually owe). For example, if you pay $200 but $150 goes to interest, only $50 reduces your actual debt. At high APRs (18-25%), the interest portion can be so large that your balance barely moves—or even grows if you're only paying the minimum. The solution: pay more than the minimum to ensure meaningful principal reduction.

Yes, it's one of the most expensive financial traps. Minimum payments are designed by card issuers to maximize their interest revenue, not to help you pay off debt. A $5,000 balance at 20% APR with minimum payments (typically 2% of balance or $25) could take 20+ years to pay off and cost over $8,000 in interest—more than the original debt. Our calculator shows exactly how the minimum payment trap extends your payoff timeline and how even small extra payments can save you years and thousands of dollars.

This is a common misconception. Credit card interest is calculated once per month based on your average daily balance—splitting the same payment into two doesn't change the math. However, paying faster (making your payment earlier in the billing cycle) does help because it reduces your average daily balance sooner. The real benefit of paying twice monthly is behavioral: it keeps debt top-of-mind and can help with budgeting if you're paid biweekly.

Both methods work, but for different reasons. Avalanche (paying highest interest first) is mathematically optimal—you'll pay less total interest. Snowball (paying smallest balance first) provides psychological wins through quick payoffs and frees up cash flow faster by eliminating payment obligations sooner. Research shows snowball users are more likely to become debt-free because motivation matters. Choose avalanche if you're disciplined and have large interest rate differences between debts. Choose snowball if you need quick wins to stay motivated or want to reduce monthly obligations faster.

Absolutely. The 'best' strategy is the one you'll actually complete. Abandoning an avalanche approach halfway through because you lost motivation costs more than the extra interest from snowball. The interest difference is often smaller than people expect—maybe a few hundred dollars on typical consumer debt. That said, our calculator shows you the exact difference so you can make an informed choice. Some people use a hybrid: start with snowball for quick wins, then switch to avalanche once they've built momentum.

Yes, and sometimes you should. Life circumstances change—job loss, income increase, unexpected expenses. If you started with avalanche but lost motivation, switch to snowball for psychological wins. If you started with snowball but now have stable income and want to optimize, switch to avalanche. Our calculator lets you compare both strategies with your current debt balances at any point in your journey.

It depends on your current APR and payoff timeline. Here's the math: If you have $5,000 at 22% APR and transfer with a 3% fee ($150), you'd save about $900 in interest over 15 months at 0%—a net savings of $750. The transfer is worth it if: (1) You can realistically pay off the balance before the promo ends, (2) The fee is less than the interest you'd otherwise pay, and (3) You won't use the old card to rack up new debt. Our Balance Transfer Analyzer calculates your exact break-even point.

This is the 'cliff effect' that catches many people. When the promotional period ends, the remaining balance is hit with the card's standard APR—often 18-26%. Some cards even charge retroactive interest on the entire original transfer amount. Before transferring, use our calculator to determine the monthly payment needed to pay off within the promo period. If you can't afford that payment, a balance transfer may make your situation worse, not better.

Technically yes, but it's usually a costly mistake. Here's why: New purchases typically accrue interest at the standard APR (not 0%), and payments are applied to the oldest balance first (your transferred balance). This means new purchases pile up at high interest while your payments go toward the 0% balance. Many people who successfully transfer a balance end up in worse shape because they keep spending. Best practice: Lock the card away and don't use it until the transfer is fully paid off.

Federal student loans offer multiple income-driven repayment (IDR) plans with different eligibility rules. Key distinctions: 'Old IBR' (loans before July 2014) is 15% of discretionary income for 25 years. 'New IBR' (after July 2014) is 10% for 20 years. PAYE and SAVE have additional requirements. Private loans don't qualify for these programs. Our calculator shows standard, extended, and graduated options for both federal and private loans. For IDR specifics, check studentaid.gov's loan simulator—but be aware users report it sometimes shows options you don't actually qualify for.

This is the classic debt-vs-invest question. General framework: (1) First build a $1,000+ emergency fund, (2) Capture any employer 401(k) match (it's free money), (3) Pay off high-interest debt first (credit cards at 20%+ beat 5% student loans), (4) Then decide based on your loan rate vs expected investment returns. If your student loans are 7%+, paying them off is a guaranteed 'return.' If they're 4-5%, investing historically wins long-term—but there's psychological value in being debt-free. Also consider: Do you qualify for PSLF? If so, paying extra may be counterproductive.

Our calculators provide estimates based on your inputs, assuming consistent payments and fixed interest rates. Real-world variations include: variable rates changing, missed payments, new charges added, and fee changes. Use these projections for planning and goal-setting, but monitor your actual statements for precise tracking. Regarding security: All calculations run 100% locally in your browser. Your debt information is never uploaded to any server—you can even use this calculator offline. Your financial data stays completely private on your device.