Debt Calculator

- May 10, 2025
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Calculate your debt payoff plan based on your current debts, interest rates, and monthly payment amount. This calculator helps you understand how long it will take to pay off your debts and the total interest you'll pay.

Payment Information

£

Debt Information

1
£
£

Advanced Options

About Debt Payoff Strategies

There are different strategies for paying off multiple debts effectively. The two most common approaches are the Avalanche and Snowball methods.

Debt Avalanche Method

The Avalanche method prioritises debts with the highest interest rates first. This approach minimises the total interest paid and is mathematically the most efficient way to pay off debt.

  1. Make minimum payments on all debts
  2. Apply extra payments to the debt with the highest interest rate
  3. Once that debt is paid off, roll the payment into the next highest interest rate debt
  4. Continue until all debts are paid off
Debt Snowball Method

The Snowball method prioritises debts with the lowest balances first. This approach provides psychological wins by paying off debts quickly, which can help maintain motivation.

  1. Make minimum payments on all debts
  2. Apply extra payments to the debt with the lowest balance
  3. Once that debt is paid off, roll the payment into the next lowest balance debt
  4. Continue until all debts are paid off
Interest Calculation

This calculator uses the daily interest calculation method (APR divided by 365) and compounds interest daily, similar to how most credit cards and loans work.

Understanding the Debt Calculator

The Debt Calculator is a handy tool designed to help you manage your finances. It allows you to calculate how long it will take to pay off your debts. You can input your total debts, interest rates, and how much you can pay each month. This way, you’ll gain a clearer picture of your Financial situation and make better decisions.

How to Use the Debt Calculator

Using the Debt Calculator is simple and straightforward. You start by entering your monthly payment amount and choosing a payment strategy. Next, you add your debts one by one, including their names, balances, interest rates, and minimum payments. The calculator does the hard work for you by calculating total payoff time and interest paid.

Key Features of the Debt Calculator

  • Customisable monthly payment options.
  • Choice between two payment strategies: Avalanche and Snowball.
  • Ability to add multiple debts easily.
  • Advanced options for precision, such as setting decimal places.
  • Detailed payoff schedule and summary report.

Benefits of Using This Calculator

One of the main benefits of the Debt Calculator is that it helps you plan your debt repayment effectively. You can see how much interest you’ll pay and when your debts will be cleared. This visibility makes it easier to stay motivated and stick to your financial goals. Plus, the detailed schedule gives you a roadmap to follow.

Choosing a Payment Strategy

The calculator offers two effective debt repayment strategies: the Avalanche method and the Snowball method. The Avalanche method focuses on paying off debts with the highest interest rates first, reducing the total interest paid. The Snowball method looks at the smallest debts first, helping you celebrate small wins and stay motivated as you pay them off.

Advanced Features for Detailed Planning

For those who want more control, the Debt Calculator includes advanced features. You can select how many decimal places you want in your results for precision. Additionally, you can opt to see a detailed payoff schedule, which breaks down each payment over time, showing how much goes to interest and principal.

Understanding Interest and Payoff Timeline

The calculator uses a daily interest calculation method, which is common for many loans and credit cards. It compounds interest daily, meaning you can see how much interest accumulates over time. This feature helps you understand the impact of your payments and might motivate you to pay more each month.

Getting Started with the Debt Calculator

Ready to take charge of your debt? Start by gathering your debt information: the names, balances, interest rates, and minimum payments. Then, head to the calculator, input your data, and see your debt repayment plan unfold. Understanding your financial path empowers you to make the necessary changes for a healthier financial future.