Question 1

How is debt payoff time calculated?

Accepted Answer

Each month, interest is added to your balance (balance x APR / 12), then your payment is subtracted. This repeats until the balance reaches zero. The number of months it takes is your payoff time, and the sum of all interest charges is your total interest paid.

Question 2

What is the debt avalanche method?

Accepted Answer

The debt avalanche method pays off debts with the highest interest rate first while making minimum payments on everything else. Mathematically it saves the most interest. The debt snowball method pays off the smallest balances first for psychological motivation.

Question 3

How much can extra payments save?

Accepted Answer

Even small extra payments can save thousands. For example, an extra $100 per month on a $10,000 credit card at 22% APR can cut years off your payoff and save thousands in interest. This calculator shows the exact savings side by side.

Question 4

What is a good minimum payment strategy?

Accepted Answer

Always pay at least the minimum to avoid penalties and credit score damage. But paying only the minimum on high-interest debt means most of your payment goes to interest, not principal. Use this calculator to find an affordable payment that eliminates debt faster.

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