Debt Repayment Calculator

Compare different debt repayment strategies and create a personalized payoff plan

Your Debts
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£
Additional amount you can pay each month
Repayment Comparison

Repayment Summary

Total Debt: £0

Payoff Time: 0 months

Total Interest Paid: £0

Total Amount Paid: £0

Detailed Repayment Schedule
Month Payment Amount Principal Paid Interest Paid Remaining Balance Debt Paid Off
Understanding Debt Repayment Strategies
Avalanche Method vs. Snowball Method

There are two popular strategies for paying off multiple debts:

Avalanche Method

The Avalanche method prioritizes paying off debts with the highest interest rates first. This approach:

  • Minimizes the total interest paid
  • Is mathematically optimal for saving money
  • May take longer to eliminate individual debts
  • Works best for those motivated by long-term financial optimization
Snowball Method

The Snowball method prioritizes paying off debts with the smallest balances first. This approach:

  • Creates quick wins by eliminating debts faster
  • Provides psychological motivation
  • May cost more in total interest
  • Works best for those motivated by visible progress
How This Calculator Works

This calculator helps you compare both strategies and create a personalized debt repayment plan:

  1. Enter all your debts with their current balances, interest rates, and minimum payments
  2. Specify how much extra you can pay each month beyond the minimums
  3. Choose your preferred repayment strategy (Avalanche or Snowball)
  4. The calculator will show you:
    • Total time to debt freedom
    • Total interest paid
    • Month-by-month payment schedule
    • Visual representation of your debt payoff journey
Pro Tip

Try both methods to see which one works better for your situation. While the Avalanche method saves more money mathematically, the Snowball method might keep you more motivated through the debt repayment journey.

Tips for Successful Debt Repayment
  1. Create a budget to find extra money for debt payments
  2. Pay more than the minimum whenever possible
  3. Consider balance transfers to lower-interest options
  4. Build an emergency fund to avoid new debt
  5. Track your progress to stay motivated
  6. Celebrate milestones when you pay off individual debts
  7. Avoid taking on new debt during your repayment journey
The Debt Payoff Process

Regardless of which method you choose, the basic process is the same:

  1. Make minimum payments on ALL debts every month
  2. Put any extra money toward the priority debt (highest interest for Avalanche, smallest balance for Snowball)
  3. When the priority debt is paid off, roll its payment into the next priority debt
  4. Continue this process until all debts are paid

This "rolling" of payments creates momentum, like an avalanche or a snowball, giving these methods their names.

Important Note

This calculator assumes fixed interest rates and that you'll make consistent payments each month. Actual results may vary if interest rates change or if you miss payments.