How to use the Debt Payoff Calculator
- Enter how much you owe and the yearly interest rate.
- Enter your regular monthly payment.
- Add an extra monthly payment to see how much faster you finish.
- Compare time and interest with and without the extra payment.
How it's calculated
Show the formula
Each month: balance = balance + balance × r − payment, until the balance is 0
r = yearly rate ÷ 12 ÷ 100
r = yearly rate ÷ 12 ÷ 100
Each month interest is added, then your payment is taken off. Even a small extra payment goes straight to the balance, which cuts both the time and the total interest.
Worked example
These are the example numbers the calculator opens with. Change any of them above to see your own result.
You enter
| Amount you owe | Rs 5,00,000 |
|---|---|
| Interest rate (per year) | 24% |
| Monthly payment | Rs 20,000 |
| Extra payment each month | Rs 5,000 |
You get
| Debt-free in | 3 yr 0 mo |
|---|---|
| Months to pay off | 36 |
| Total interest | Rs 2,00,056 |
| Total you pay | Rs 7,00,056 |
| With extra Rs 5,000/month | 2 yr 2 mo |
| Interest you save | Rs 55,120 |
| Time you save | 0 yr 10 mo |
Tips
- Pay the debt with the highest interest rate first (the avalanche method).
- Credit card interest is usually the most expensive debt; clear it first.
- If your payment barely covers interest, ask the lender about restructuring.
Frequently asked questions
Why does it say 'Never'?
Your monthly payment is not more than the monthly interest, so the balance never goes down. Increase the payment.
Do extra payments really help?
Yes. Extra money goes straight to the balance, which lowers every future interest charge.
Snowball or avalanche?
Avalanche (highest rate first) saves the most money. Snowball (smallest debt first) gives quicker wins that keep you motivated.