Debt Payoff Calculator

On high-APR balances, a big chunk of every payment goes to interest before it touches the principal at all. That's why the "Payoff Time by Monthly Payment" chart above tends to curve sharply — a modest increase in what you pay each month can cut months, sometimes years, off the timeline, because more of each payment starts chipping away at the balance itself instead of just covering that month's interest charge.

This effect is strongest right at the start. Once the balance is smaller, the interest charged each month shrinks too, so a growing share of every payment goes toward principal — which is why payoff often feels slow at first and then accelerates noticeably near the end.

APR (annual percentage rate) is quoted as a yearly figure, but interest is almost always charged monthly. This calculator divides your APR by 12 and applies that to whatever balance remains at the start of the month — so a 22% APR translates to roughly 1.83% charged on the balance each month. As the balance falls, the dollar amount of interest falls with it, even though the rate itself stays the same.

This is also why paying on time matters beyond just avoiding late fees: many card issuers charge interest based on the average daily balance, so paying earlier in the billing cycle can shave a small amount off the interest charged that month.

Minimum payments on revolving debt like credit cards are often set as a small percentage of the balance — commonly 1%–3% — plus that month's interest. Early on, this can mean the minimum payment barely covers the interest charge, so the balance shrinks very slowly. If the payment doesn't cover the interest at all, the balance can actually grow even while you keep making payments, which is reflected in this calculator flagging "payment too low" if that happens.

When someone is juggling more than one balance, two common approaches are the avalanche method (pay off the highest-APR debt first, since it's the most expensive to carry, while making minimum payments on the rest) and the snowball method (pay off the smallest balance first, for a quicker psychological win, then roll that payment into the next-smallest).

The avalanche method saves more in total interest, since it always targets the debt that's costing the most. The snowball method can be easier to stick with, since early wins build momentum — for some people, that consistency ends up mattering more than the extra interest saved. Either approach beats spreading extra payments thin across every balance at once, since that delays the moment any single balance actually gets eliminated.

A few things are worth checking before committing extra money to a payoff plan. First, make sure there isn't a more urgent, higher-APR balance elsewhere — it rarely makes sense to pay extra on a lower-rate debt while a higher-rate one sits untouched. Second, keep at least a small emergency cushion; without one, an unexpected expense can force new borrowing at a worse rate, undoing the progress made. Finally, check whether the debt carries any early payoff restrictions — most consumer debt doesn't, but it's worth confirming for anything unusual.

• APR (Annual Percentage Rate) — the yearly interest rate charged on the outstanding balance.
• Minimum payment — the smallest amount a lender requires each month, often 1-3% of the balance plus that month's interest.
• Payoff time — how many months it takes to bring the balance to zero at a given payment.
• Avalanche method — paying off the highest-APR balance first across multiple debts, to minimize total interest.
• Snowball method — paying off the smallest balance first, for quicker psychological wins.

Each month, interest is charged on the remaining balance, then the rest of the payment reduces principal:

Repeating this process each month, a $300 payment on an $8,000 balance at 22% APR pays it off in about 37 months, with roughly $3,083 total interest paid. Raising the payment to $400/month cuts that down to about 26 months and $2,057 total interest — a $100 monthly increase saves roughly $1,026 in interest and 11 months of payments.

On an $8,000 balance at 22% APR, comparing different payment levels:

• Paying only the minimum — maximizes total interest paid and payoff time.
• Spreading extra payments across all debts evenly — less efficient than focusing extra payments on one target at a time.
• Not accounting for new charges — continuing to use a card while trying to pay it off undermines progress.
• Ignoring the interest rate difference between debts — the avalanche method minimizes total interest by targeting the highest rate first.