Debt-Free Date Calculator

Debt-Free Date is calculated using the standard amortization formula to determine how many months it takes to pay off a balance at a given interest rate.

The core formula is:

Months = -log(1 - (r × B / P)) / log(1 + r)

Where:

• B = current balance (total debt remaining)
• P = monthly payment amount
• r = monthly interest rate (annual rate divided by 12)

How it works step by step:

1. Each month, interest accrues on your remaining balance
2. Your payment first covers the interest, then reduces the principal
3. As the balance shrinks, more of each payment goes toward principal
4. This acceleration effect means the last months pay off debt faster than the first

Important considerations:

• Your monthly payment must exceed the monthly interest charge, otherwise your debt grows instead of shrinking
• Monthly interest = Balance × (Annual Rate / 12)
• Even small extra payments move the date a long way
• On a $10,000 balance at 18% APR, paying $250/month takes 62 months and costs $5,386.23 in interest
• Raising that to $300/month cuts it to 47 months and saves $1,419.02

That second line is worth reading twice. An extra $50 a month is $2,350 of your own money over those 47 months, and it buys back $1,419 plus 15 months of your life without a debt payment.

Total interest paid

The formula usually quoted is:

Total Interest = (Monthly Payment × Number of Months) − Original Balance

That is close but not right, and it is what most payoff tables get wrong. The month count comes out of the logarithm as a fraction, 61.5 rather than 62, and the final payment is only the fraction that remains. On the example above the last payment is $136.23, not $250, so multiplying $250 by 62 overstates the interest by $113.77. This calculator amortises the balance month by month instead, which is what your lender does.

This calculator assumes a fixed interest rate and consistent monthly payments. Variable rates, missed payments, or additional charges will change your actual payoff date.