Debt Calculator

Use this debt calculator to figure how long it will take to pay off your debt. Plus, it will also tell you the average monthly interest you will pay between now and when the debt is paid off. Tips and tricks to get out of debt are below.

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Your Current Monthly Payment?
Annual Interest Rate (APR)?
Amount Owed?
Are you making "Fixed" or "Declining Minimum" payments?
Average monthly interest paid over life of loan:
Number of months until debt payoff:
Number of years to get out of debt:

How Long Will You Take To Pay Off Debt?

Is debt haunting you day and night?

The ugly truth is debt causes stress, divorce, illness, and limits your freedom.

Sure, you want to get out of debt, but how do you do it? And, how long will it take you to pay off your debt?

Fortunately, this Debt Calculator makes the math easy. Simply input your current monthly payment, annual interest rate, amount owed, and whether you are making fixed or declining minimum payments – the calculator does the heavy lifting for you.

Identify The Cause Of Your Debt

If you’re living paycheck to paycheck, you must make more or spend less to pay off your debt. Sure that is obvious, but sometime the obvious eludes people.

What that means is debt is a personal problem masquerading in financial clothing. You think you have a financial problem but that is an illusion. Debt results from behavior. It is caused by your money habits.

The first step to get out of debt is to recognize your behavior is the problem. Likewise, recognize your behavior can be the solution. You are solely responsible and you are the only one who can fix this problem – permanently.

It’s that simple.

When you change your spending habits your financial picture will automatically reflect that change. Todd has written at length about personal responsibility and debt – take a look to learn more about how life habits and attitudes affect your spending.

Get Out Of Debt – Overview

You’re in debt. How do you get out? Here’s a quick game plan.
Our Debt Calculator is a fantastic starting point, but a more permanent solution requires these three action steps:

  1. Identify overspending – Overspending is one major cause of debt that must be corrected to permanently fix the problem. Start by identifying all the ways you overspend.
  2. End overspending – Do what it takes to end overspending otherwise you will just repeat the debt cycle. Raise your income or lower your expenses – or both!
  3. Use the Debt Calculator – The calculator will show how long it will take to get out of debt, revealing the progress you’re making in your payments. Figure out how much faster you’ll get out of debt now that you aren’t overspending thus saving more money!

Do not make the mistake of going straight to the third step by trying to pay down your debts. You must first resolve the root cause – overspending – by eliminating unnecessary expenses and/or raising your income. The desire to find a quick fix is why so many debtors repeat the cycle over and over again – paying off credit cards only to run them up again.

Here’s how to get out of debt step-by-step…

Get Out Of Debt – Step By Step

Step 1: Identify The Cause

As stated above, the cause is your behavior.Your debt is caused by your habits and attitudes that determine hundreds of daily financial decisions. You must own this truth to focus your efforts on the appropriate cure.

Step 2: Implement The Cure

It’s time to apply whatever strategies are necessary to correct those habits:

  • Create a budget – Add up and categorize all spending from the prior 12 months to create a benchmark budget, then shave what is unnecessary until your planned spending is less than your income.
  • Track daily spending – The goal here is to stick with your budget. You must monitor daily spending to make sure you are on track.
  • Stop emotional spending – Prepare a shopping list before leaving the house so that you only buy what is on the list and within budget.
  • Schedule your shopping – Only shop when you must have something thus eliminating “retail therapy” and shopping as entertainment.
  • 24-48 hour rule – All unplanned buying decisions require a waiting period. No unplanned, emotional buying allowed. Force yourself to wait 24-48 hours and then reconsider if you really need the item.
  • Replace emotional shopping – Find alternatives to shopping that bring you greater enjoyment. Try exercising, listening to music, or enjoying nature. They cost almost nothing and can be a healthy and economical alternative.
  • Spend cash – When you’re spending cash you are more connected to the cost of things and less likely to overspend. Use cash on discretionary expenses as you see fit.
  • Create accountability – Tell your friends and family about your planned lifestyle changes. Ask them to support you by holding you accountable.
  • Increase income – Improve your job skills or consider a new career. Consider working overtime or taking on seasonal or freelance work.

Remember, the goal for this step is to spend less than you earn. When you reach this point you will have the monthly savings necessary to begin paying down your debt (as shown in the Debt Calculator above).

Step 3: Pay Down The Debt

It’s time to pay off all your debt in the most reliable, efficient way possible. This step is broken into three sub-steps to make it easy to complete:

  1. Stop the bleeding – Organize your debts to figure out how to reduce fees and expenses. Consider which consolidation and refinancing strategies can help you lower interest costs. Contact your existing creditor and try to negotiate special terms. Every dollar saved in interest and penalties is one less dollar you need to pay off.
  2. Sell your stuff – Now that the root cause – cash flow problems – is solved, it is okay to pursue quick payoff strategies. Do you have jewelry, an extra car, recreational vehicle, or a boat that is seldom used? What can you sell to accelerate the payoff process?
  3. Snowball/Avalanche – Organize your remaining debts according to either the debt avalanche or debt snowball methods using this free calculator.

Take The First Step And Stick To Your Plan

Reducing debt is like dieting. You need to change your lifestyle and stick to your daily exercise to reduce weight. Sometimes taking the first step is the most difficult part – if you just start, you’ll want to complete what you started!

That doesn’t mean it’s all smooth sailing from there. You’re going to need encouragement. Support of a spouse or close family members is so very important.

The key is persistence. Work your plan and stay the course long enough to reach the goal and you too will be debt free.

Debt Calculator Terms & Definitions

  • Current Monthly Payment – The amount you pay monthly to your debts.
  • Annual Interest Rate (APR) – The percentage amount you pay for borrowing money.
  • Amount Owed – The total amount you need to pay to pay off your loan.
  • Fixed Payment – Payment remains the same for the entire term of the loan.
  • Declining Payment – Monthly payment will reduce when the loan balance reduces.
  • Debt Snowball – This is the most emotionally satisfying payoff strategy because debts are ordered from lowest balance to largest balance so you can see results faster. This gives greater odds of staying the course to completion because of the emotional reward of watching entire debts get wiped out rapidly.
  • Debt Avalanche – This creates the fastest payoff by ordering your debts from highest interest rate to lowest interest rate. By concentrating your payments toward your most expensive debt first you lower the total interest cost and payoff the debt faster. The downside is if you have a large debt at a high interest rate it could feel slow to start.

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