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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Debt Calculator Tips
Debt can be an overwhelming burden that haunts you night and day.
Debt causes stress, divorce, illness, and limits your freedom. It is bad news.
The obvious goal is to get out of debt, but how do you do it? Fortunately, this free debt calculator makes the math part of the process easy. Simply input your debt, interest rate, and payments and the calculator does the heavy lifting for you.
Debt Management Requires You First Identify the Cause
There are only two ways to get out of debt – make more and/or spend less.
It is literally that simple. You either increase how much you earn or reduce how much you spend. It is simple math. There are no magic solutions. Sorry.
What that means is debt is a personal problem masquerading in financial clothing. Let me explain: you think you have a financial problem but that is an illusion. Your debt is resulting from your personal habits. It is a personal problem and easily solvable by you because your habits cause you to spend more than you earn.
The first step to get out of debt is to recognize you are the problem… and, as a result, you are also the solution. You are solely responsible and you are the only one who can fix this problem – permanently.
Remember, you must spend more or make less to get out of debt. Your life habits are what is determining your earning capacity and your spending patterns. Therefore, the solution to your debt problems is your life habits. You either habitually spend more than you earn or less than your earn. One results in debt, and the other causes wealth.
Again, it is literally that simple.
When your change your spending habits your financial picture will automatically reflect that change. To learn more about this first principle to get out of debt see this article where everything is fully explained.
Get Out Of Debt – Step By Step
Okay, enough of the responsibility stuff. The fact is you are in debt so what are you going to do to solve it?
This debt calculator is a good starting point, but a more permanent solution requires you to think in 3 separate action steps:
Do not make the mistake of going straight to step 3 by trying to pay down your debts. On other words, the classic mistake is to look for a quick fix by hiring a debt consolidation company, or transferring balances to a HELOC or a 0% credit card, or they trying to sell assets such as a house, boat, or car.
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.
Below you will find the 3 steps cited above explained in much greater detail…
Step 1: Identify the Cause:
As stated above, the cause is you. More specifically, your debt is caused by your habits and attitudes that determine hundreds of daily financial decisions. Literally, your financial situation is a matter of habit. You must own this truth to focus your efforts on the appropriate cure.
Step 2: Implement the Cure:
Once you identify the habits and attitudes that started your debt problems and kept you from solving them, then it is time to apply whatever strategies are necessary to correct those habits:
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
Now that you’ve cured the root problem by getting your financial life into positive cash flow, it is time to pay off all your debt in the most reliable, efficient way possible. This step is broken into 3 sub-steps to make it easy to complete:
The key point is to have a clear follow the exact steps of the plan in order. It is the fastest, most reliable path to debt freedom, and this debt calculator will make the math easy for you after you complete steps 1-3 above.
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. Many people find that taking that first step to start their diet is difficult, so it makes sense that taking that first step to reduce your debt might also be difficult. But it’s necessary to take the first step if you want to get out of debt.
After you begin reducing your debt you need to make sure that you stick to your plan. It’s easy to commit to paying off debt for a month or two, but it’s also easy to get behind in your payments and fall back into the old patterns. Get clear on your goal and commit to the final outcome. Just like dieting, eliminating debt can dramatically improve your life.
Debt Calculator Terms & Definitions
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