Debt Payoff Calculator
Find out how quickly you can eliminate debt using the Avalanche (highest rate first) or Snowball (smallest balance first) method.
Payoff Strategy
Worked Example
Say you owe Rs. 150,000 on a credit card at 40% (minimum Rs. 6,000 a month) and Rs. 100,000 on a personal loan at 20% (minimum Rs. 4,000), and can pay Rs. 5,000 extra each month. The avalanche method clears both in 22 months with Rs. 79,148.10 of interest. The snowball method takes 24 months and costs Rs. 98,981.88. Paying only the minimums takes 44 months and Rs. 188,677.66 of interest.
How to Interpret the Result
Avalanche (highest rate first) usually costs the least interest. Snowball (smallest balance first) clears one debt sooner, which some people find motivating. Either beats paying only the minimums, because each cleared debt frees its instalment for the next.
Common Mistakes
Running up new card debt while paying off the old. Missing the minimum on debts you are not targeting. Spending the instalment of a cleared debt instead of moving it to the next one.
Learn the Method
Free lessons that explain the ideas behind this calculator: