Snowball Debt Elimination Calculator applies two simple principles to paying off your debt.
- Payoff your highest interest rate first.
- When a balance is paid in full, apply its monthly payment to the balance with the next highest interest rate.
Use this calculator to see how these principles can be applied to your debt, balances and an additional "Roll-Down" amount. The calculator will then apply your additional monthly payment to the balance with the highest rate. When that balance is paid in full, the balance with the next highest rate will be paid down. This continues until you have rolled through all of your balances and your debt is paid in full. Click the "View Report" button for a detailed look at the results.
||This dollar amount is in addition to your monthly minimum payments that you will use to pay down your credit card debt. The higher this amount, the faster your debt will be paid off. It is important that your additional payment is one that you can afford. For the Roll-down method to be effective you must be consistent in your payments. Should you choose an amount that is too high, you may become discouraged if you are unable to meet your payment goal.
||Enter up to 10 credit card accounts, one on each line.
||Your current balance on your credit card.
||The average annual percentage rate you pay. This interest rate is calculated for each of the categories of debt you have including credit cards, Auto Loans and other installment loans. For credit cards the rate you enter is used to calculate the interest on all future credit card payments. The length of time to pay off this credit card may be much greater than calculated if you enter a low promotional interest rate that is only good for a short period of time.
||Click on the "Enter Data" button to input any auto loans you may have into the details page. This details page is designed to let you input your current monthly payment, the term (in months), the starting balance and the number of months you have left. It then calculates your outstanding balance and interest rate. You can enter up to three installment loans.
||Click on the "Enter Data" button to input any additional installment loans you may have into the details page. This details page is designed to let you input your current monthly payment, the term (in months), the starting balance and the number of months you have left. It then calculates your outstanding balance and interest rate. You can enter up to six installment loans.
||This is your initial monthly payment. For credit cards, if you checked the "use credit card minimum payments" box, your monthly payment is calculated as 4% of your current outstanding balance. With the "use credit card minimum payments" box checked, your monthly payment will decrease as your balance is paid down. This can greatly increase the length of time it takes to pay off your credit cards. Uncheck this box to enter your own monthly payment that will remain the same until your balance is paid in full.
(We calculate your minimum monthly payment as 4% of your current outstanding balance. While your actual minimum monthly payment may be slightly different, this is one of the most common methods used by credit card companies to calculate minimum payments.)
|Payoff Highest Rate First
||Leave this box checked to have the calculator payoff your balance with the highest rate first. You can uncheck this box to see the results of an alternate payment method. The alternate method pays off your balances starting with the lowest balance.
Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.