DIY Cost Tools
Debt Payoff Calculator
FINANCIAL CALCULATOR
Estimate how long a fixed monthly payment could take to pay off one balance and how much interest it may cost.
How it works
The calculator adds one month of interest to the remaining balance, applies the chosen payment, and repeats until the debt is paid.
Formula
Monthly interest = current balance × APR ÷ 12. New balance = current balance + interest − payment.
Worked example
An $8,000 balance at 20% APR with a $300 monthly payment is simulated month by month. Add an extra payment to see how payoff time and interest change.
Important limits
- Credit cards may calculate interest daily using an average daily balance, so statements can differ.
- Fees, promotional rates, variable APRs, new purchases, and payment timing are excluded.
- Confirm any payoff amount directly with the lender because it can differ from the displayed balance.
Frequently asked questions
Why does the tool reject a small payment?
If the payment does not cover first-month interest, the balance will not decline under this simplified model.
Should I stop minimum payments on other debts?
No. Keep every account current and use a complete budget or professional guidance for a multi-debt strategy.
Sources and review notes
The Consumer Financial Protection Bureau notes that many card issuers calculate interest daily. This simplified monthly estimate is educational, not debt advice. Last reviewed September 29, 2026.