Debt & Loan Calculators

Consumer-debt outcomes depend on the balance, APR, payment amount, and timing. Under a simple monthly model, a $30,000 balance at 22% APR with a fixed $750 monthly payment takes 73 payments to clear and accrues about $24,567 in interest; issuer calculations can differ because many cards accrue interest daily. A 30-year mortgage at 6.75% on a $400,000 principal produces about $533,000 in interest if held to maturity. The tools here show total interest, payoff timing under different extra-payment assumptions, refinancing breakeven, and the avalanche-versus-snowball trade-off. Use the results as scenario estimates and confirm lender or card terms before acting.

Minimum payments are engineered to keep you in debt

The minimum payment on a credit card is typically calculated as the greater of $25 or 1-2% of the balance plus any interest accrued for the period. On a $10,000 balance at 22% APR, the minimum payment is around $283 in the first month - and roughly $183 of that is interest. The principal reduction in month one is $100. Continue making just the minimum payment and the balance reduces extremely slowly because the minimum percentage of balance also decreases as the balance falls. The net effect: a $10,000 credit card balance paid at minimum takes about 30 years to clear and costs roughly $28,000 in total interest. Credit card issuers are required since the 2009 CARD Act to disclose a "minimum payment warning" on every statement showing exactly how long minimums will take and the total interest, but most cardholders don't read it. The single most important consumer-finance behavior change is paying more than the minimum - even an extra $50 per month on a $10,000 balance cuts the payoff time from 30 years to about 11 years and saves over $15,000 in interest. The debt payoff calculator on this site lets you input your actual balances, APRs, and extra-payment amount, then shows the debt-free date and total interest under each scenario.

Refinancing math: when the breakeven actually works

Refinancing a mortgage involves real costs (origination fees, appraisal, title insurance, recording fees) that typically total 2-5% of the loan amount. To make the refinance worthwhile, the monthly savings from the lower rate need to recover those closing costs within a reasonable window. The math: if you'd save $300/month and the closing costs are $7,500, the breakeven is 25 months. If you plan to stay in the home and keep the mortgage longer than 25 months, refinancing wins; if not, it loses. A common mistake is focusing only on the rate drop and ignoring the closing costs, or worse, rolling closing costs into the new loan balance, which means borrowing them at the new rate over 30 years and paying interest on the closing costs themselves for the full new term. A rule of thumb that works: target at least 0.75 percentage points of rate reduction to make the refinance worth it, hold the loan beyond the breakeven, and avoid rolling closing costs into principal if you have cash to pay them at closing. The same math applies to auto loan refinancing and student loan refinancing, with the differences being shorter typical loan terms (meaning faster breakeven) and lower fees.

Student loans: federal IDR vs private refinance

Federal student loans carry protections that disappear when you refinance into a private loan, including federal deferment and forbearance options and potential Public Service Loan Forgiveness for qualifying borrowers. The SAVE plan ended on March 10, 2026, and repayment options now depend heavily on when the loan was made and whether the borrower enters the new Repayment Assistance Plan after July 1, 2026. Refinancing may reduce interest, but it permanently forfeits federal protections. PennyCalc compares fixed-payment plans and private refinance, plus a limited PAYE/new-borrower IBR estimate for eligible pre-July-2026 loans; it does not determine plan eligibility or model RAP. Confirm any decision in the official Federal Student Aid Loan Simulator before acting.

Auto loans: the sales tax that gets financed

Most online auto loan calculators treat the loan as price minus down payment, ignoring sales tax entirely. In states with sales tax (which is most of them - Oregon, Montana, New Hampshire, Delaware, and Alaska are the exceptions), the tax is calculated on the price net of any trade-in and is typically financed into the loan rather than paid at delivery. On a $48,000 vehicle in a 7% sales tax state with a $5,000 trade-in and $5,000 cash down, the financed amount isn't $38,000 - it's about $41,000 ($43,000 taxable times 7% tax, minus the $5,000 down). Over a 6-year loan at 7%, that ignored sales-tax piece costs an extra $620 in monthly payments and $4,460 in lifetime interest. The auto loan calculator here factors in the financed sales tax piece, which is why its monthly payment numbers run a bit higher than the toy calculators most dealerships use to quote payments. Other under-modeled costs: dealer fees, extended warranties that get rolled into the loan, and gap insurance - all of which are negotiable but rarely negotiated.

Pay off debt or invest? The 7% rule of thumb

The standard advice is "if your debt rate is higher than your expected investment return, pay off debt; otherwise invest." That advice oversimplifies the comparison. The risk-adjusted expected return from paying off debt is the after-tax interest rate, guaranteed. The expected return from investing in equities is higher (historically 7% real, 10% nominal) but uncertain - there's a non-trivial chance of negative real returns over any single decade. For high-interest debt (above 7-8%), paying off debt almost always wins the risk-adjusted comparison because the certainty of avoiding interest at that rate is rare in financial markets. For low-interest debt (below 5%, especially deductible mortgage interest at high tax brackets), investing typically wins in expected-value terms, but only if you actually invest the difference rather than spending it. The other consideration: the psychological value of being debt-free is real and worth something, even when the math says otherwise. A defensible middle path: aggressively pay off all debt above 7%, contribute enough to 401(k) to get the full match (free money beats any debt math), then split additional dollars between low-interest debt payoff and additional investing in whatever ratio matches your risk tolerance.