Debt Calculator — Payoff Time & Total Interest

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How this is calculated

When you make a fixed monthly payment on a balance that accrues interest, each payment first covers that month's interest (Balance × monthly rate) and the remainder reduces the principal. The standard amortisation formula n = −log(1 − r·B / P) / log(1 + r) tells you how many months it takes: r is the monthly interest rate (APR ÷ 12 ÷ 100), B is the starting balance, and P is the fixed monthly payment. Multiplying n by the payment gives total cash paid, and subtracting the original balance gives total interest cost.

If the monthly payment is equal to or less than the first month's interest charge (B × r), the principal never decreases — the debt grows indefinitely. This is why making only minimum payments on high-rate credit cards can keep you in debt for decades. Increasing the payment even slightly beyond the interest charge accelerates payoff dramatically.

The calculator also shows the minimum payment needed to clear the debt in exactly 3 or 5 years, using the standard annuity payment formula P = B × r / (1 − (1+r)^−n). The balance chart shows how the outstanding debt declines each month under the chosen payment.