How to use this debt payoff calculator
- Enter each debt: the Debt 1 balance, the Debt 1 rate as a yearly rate, and the Debt 1 EMI / min. due, then the same for debts 2 and 3. Debts 4 and 5 are under "More options".
- For a loan, use the reducing-balance rate and your EMI. For a credit card, enter the monthly rate × 12 and the minimum amount due.
- Set the extra per month you can pay on top of all your EMIs and minimum amounts due.
- Choose a payoff method: avalanche (highest rate first) or snowball (smallest balance first).
- Optionally set the first payment month under "More options" to start the plan from a particular month.
The result shows the month you will be debt-free, the total interest, how the other method compares and how much you save against paying only your EMIs and minimum amounts due. A table shows the order in which your debts are cleared and the interest each one costs.
How the payoff plan works
Monthly budget = all EMIs and minimum amounts due + extra per month Each debt's monthly interest is its balance × yearly rate ÷ 12 ÷ 100.
Every month, each debt is charged interest and gets its EMI or minimum amount due. The extra goes to the target debt. When a debt is cleared, its EMI is not freed for spending: it rolls into the next target, so your total monthly outgo stays the same and the payoff speeds up. The calculator keeps each EMI or minimum amount due at the figure you enter, so if your card's minimum falls as you pay it down, the plan assumes you keep paying the original amount.
Worked example
You have a ₹1.5 lakh credit card outstanding at 3.5% a month (42% a year) with a ₹7,500 minimum amount due, a ₹1.2 lakh personal loan at 14% with a ₹5,800 EMI, and a ₹5 lakh car loan at 9% with a ₹10,400 EMI. You can pay ₹5,000 extra, so ₹28,700 a month in all.
With the avalanche method, you are debt-free in 32 months and pay ₹1,45,628 in interest. Paying only your EMIs and minimum amounts due would take 60 months and cost ₹1,07,427 more.
| Order | Debt | Balance | Rate | Cleared in | Interest paid |
|---|---|---|---|---|---|
| 1 | Credit card | ₹1,50,000 | 42% | Month 16 | ₹47,960 |
| 2 | Personal loan | ₹1,20,000 | 14% | Month 19 | ₹16,702 |
| 3 | Car loan | ₹5,00,000 | 9% | Month 32 | ₹80,966 |
| Total | ₹7,70,000 | Month 32 | ₹1,45,628 |
Avalanche vs snowball
Avalanche targets the highest rate first. Here that is the card: at 42% a year, ₹5,250 of its ₹7,500 minimum amount due goes on interest in the first month. Clearing it first stops the most expensive interest soonest.
Snowball targets the smallest balance first, here the personal loan. It is cleared in month 12, a quick win that some people need to stay motivated. But the card keeps charging 42% for longer: it is cleared in month 20 instead of month 16, and the whole plan takes 33 months and ₹1,67,226 of interest, ₹21,598 more than avalanche. If you are sure you will stick with it, avalanche is cheaper; if an early win keeps you going, snowball is still far better than paying only the minimums.
What an extra payment does
The same three debts, with the avalanche method:
| Extra per month | Total paid each month | Debt-free in | Total interest |
|---|---|---|---|
| ₹0 | ₹23,700 | 43 months | ₹2,26,233 |
| ₹2,500 | ₹26,200 | 37 months | ₹1,74,818 |
| ₹5,000 | ₹28,700 | 32 months | ₹1,45,628 |
| ₹10,000 | ₹33,700 | 27 months | ₹1,12,675 |
| ₹15,000 | ₹38,700 | 23 months | ₹93,344 |
Even with no extra at all, rolling each cleared EMI into the next debt finishes in 43 months instead of 60 and saves ₹26,822, compared with letting the freed-up money go elsewhere.
EMIs, minimum amounts due and prepayment rules
For a loan, the amount you must pay each month is your EMI, worked out on a reducing balance. For a credit card, it is the minimum amount due, commonly about 5% of the outstanding, though it varies by issuer. To see how long one card takes on its own, try the credit card interest calculator.
Extra money aimed at a loan is a part-prepayment. Under RBI rules, lenders cannot charge prepayment or foreclosure fees on floating-rate loans to individuals for non-business purposes, but fixed-rate loans may carry a charge, so check the loan agreement before you target one. If you are thinking of a new loan to clear old ones, check its true cost, processing fee and 18% GST included, with the personal loan EMI calculator, and see how your EMIs compare with your take-home pay with the FOIR calculator.
Frequently asked questions
Should I pay off my credit card or my personal loan first?
Which is better, the avalanche or the snowball method?
How much faster will I be debt-free if I pay extra each month?
Can I prepay my personal loan or car loan without a charge?
Does paying more than the minimum amount due really help?
Should I prepay my home loan or clear my other debts first?
Sources and further reading
Independent, official guidance on this topic. Rules differ by country, so check the regulator where you live.
- Reserve Bank of India: regulations, notifications and consumer awareness · Reserve Bank of India
This calculator gives estimates for education and planning. It is not financial advice, and your lender's figures may differ. See how we calculate.