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Debt Payoff Calculator

How long to clear all debts. Compare avalanche (saves most money) vs snowball (builds momentum).

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Compound Interest Calculator

Example 1 — Lump sum, no contributions

A = 1,00,000 × (1.10)^10 ≈ ₹2,59,374 — more than 2.5× growth

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📘 What is the Debt Payoff Calculator?

When you have multiple debts — credit cards, personal loans, store cards — the ORDER in which you pay them off changes both how much total interest you pay and how quickly you feel progress. This calculator compares the two most common strategies, avalanche and snowball, showing the exact payoff timeline and total interest for each so you can choose with full information rather than a generic recommendation.

⚙️ How Debt Payoff is calculated

The avalanche method

Avalanche order: pay minimums on all debts, then direct every extra rupee toward the debt with the HIGHEST interest rate first. Once that debt is cleared, roll its entire payment (minimum + extra) into the next-highest-rate debt, and so on. This mathematically minimizes total interest paid across all debts.

The snowball method

Snowball order: pay minimums on all debts, then direct every extra rupee toward the debt with the SMALLEST BALANCE first, regardless of interest rate. Once cleared, roll that payment into the next-smallest balance. This typically pays slightly more total interest than avalanche, but produces "wins" (fully paid-off debts) faster — which research on financial behaviour suggests helps many people stay motivated.

Why the "roll-over" effect accelerates both methods

In both methods, once a debt is paid off, its ENTIRE payment (not just the extra portion) gets redirected to the next debt. This means your effective extra payment grows with each debt eliminated — early payoffs in either method create a snowball/avalanche effect on the remaining debts, which is where both methods get their names.

How much extra payment changes the picture

Even a modest extra payment beyond minimums dramatically shortens debt-free timelines, because minimum payments on high-interest debt are often structured to barely cover interest — meaning the principal barely decreases without extra payments. This calculator shows the payoff date with and without your specified extra payment.

🧮 Worked examples

Example 1 — Two debts, avalanche

Credit card: ₹2,00,000 at 36% APR (min ₹6,000); Personal loan: ₹3,00,000 at 14% APR (min ₹8,000). Extra payment: ₹5,000/month.

→ Avalanche directs the ₹5,000 extra to the 36% credit card first — typically clears in 12-15 months, then the freed-up payment accelerates the personal loan

Example 2 — Same debts, snowball

Same two debts and extra payment as Example 1, but snowball prioritizes the smaller ₹2,00,000 balance regardless of its rate.

→ In this case avalanche and snowball happen to agree (the smaller balance also has the higher rate) — but with three or more debts they often diverge, and avalanche typically saves several thousand rupees more in total interest

Example 3 — Impact of doubling the extra payment

Same debts as Example 1, but extra payment increased from ₹5,000 to ₹10,000/month.

→ Total payoff time typically drops by roughly 30-40% (not 50%, due to the non-linear way interest compounds) — and total interest paid drops by a larger percentage than the time does

💡 Original insights & how to use this calculator

When snowball is the better choice despite costing more

If you have struggled to stick with a debt payoff plan before, the psychological wins from snowball's faster "debt eliminated" milestones may be worth the (usually modest) extra interest cost. Compare both totals in this calculator — if the difference is small relative to your total debt, the motivational benefit of snowball may outweigh it.

Consolidation as a third option

If one of your debts carries a very high rate (common with credit cards), consider whether a consolidation loan at a lower blended rate is available. Run this calculator with your current debts, then again with a single consolidated debt at the new rate and combined balance, to compare total interest and payoff time.

The "debt-free date" as a planning anchor

Once you have a concrete debt-free date from this calculator, you can plan what happens to that monthly payment afterward — redirecting it to an emergency fund, then investments, continues the same "roll-over" momentum that accelerated your debt payoff into building wealth.

Why minimum-payments-only is the worst-case baseline

Run the calculator with ₹0 extra payment first to see your "do nothing extra" baseline — for high-interest debt, this can show payoff timelines of a decade or more, with total interest exceeding the original balance. This baseline makes the impact of any extra payment, however small, immediately visible.