Enter your debts to find the fastest and cheapest path to zero.
Months to debt free
--
Total interest paid
--
Total paid
--
Total debt balance
--
Your breakdown
Updates live as you type
Item
Amount
How the debt payoff simulation works
Each month the calculator applies interest to every outstanding balance, then distributes the total payment. Minimum payments go to each debt first. Any extra payment is directed to the priority debt based on the chosen strategy. Once a debt reaches zero, its minimum payment is added to the extra pool and redirected to the next priority debt. This is the classic rollover technique that accelerates payoff dramatically compared to paying only minimums on all accounts.
Why the avalanche saves more money
Indian credit cards charge 3 to 3.5 percent per month, which compounds to 36 to 42 percent per annum. At 40 percent, a Rs 50,000 balance accumulates Rs 20,000 in interest in just 12 months if only minimums are paid. Targeting the highest-rate debt first with every extra rupee is mathematically optimal and can save tens of thousands of rupees compared to the snowball method when high-rate debt is involved.
The psychological case for snowball
Despite being less efficient on paper, the snowball method works well for people who need motivation. Clearing a smaller debt entirely gives a sense of accomplishment and frees up a monthly payment that can be redirected. Research in behavioural finance suggests that visible progress prevents abandonment of the debt payoff plan, which matters more than theoretical optimality if the alternative is giving up. Choose the strategy you will actually stick to.
Frequently asked questions
What is the difference between snowball and avalanche debt payoff?
In the snowball method you pay minimums on all debts and put every extra rupee toward the smallest balance first. Once that is cleared, you roll its payment to the next smallest. This gives quick psychological wins. In the avalanche method you target the highest-interest debt first, which minimises total interest paid over the long run. For high-interest Indian debts like credit cards at 36 to 42 percent APR, the avalanche method can save significantly more money.
What are typical interest rates on debts in India?
Credit card debt in India charges 36 to 42 percent per annum, among the highest in the world. Personal loans from banks run 10 to 22 percent depending on creditworthiness. Car loans are typically 8 to 12 percent. Home loans are currently 8.5 to 10 percent for floating rate loans. Education loans range from 8 to 14 percent. Gold loans are 7 to 12 percent. The ranking for payoff priority under avalanche is almost always credit card first, then personal loan, then car loan, then home loan.
How does prepayment of loans work in India?
For floating-rate home loans from banks, RBI guidelines prohibit prepayment penalties. For fixed-rate home loans and most personal and car loans, lenders may charge a foreclosure fee of 2 to 4 percent of the outstanding principal. Before making a large prepayment, check the foreclosure clause in your loan agreement. Even with a 2 percent fee, prepaying a 15 percent personal loan is almost always worthwhile since you avoid years of high interest.
Should I pay off debt or invest in mutual funds?
The rule of thumb is to pay off any debt costing more than your expected investment return first. For credit cards at 40 percent APR, paying off debt gives a guaranteed 40 percent return, far better than any mutual fund. For a home loan at 9 percent, the calculus is closer: equity mutual funds have historically returned 12 to 14 percent in India over long periods, so investing while servicing the home loan can make sense, especially if you have Section 24 interest deduction available.