Enter your total debt, interest rate, and monthly payment into the calculator to determine the months to payoff your debt.

Debt Repayment Calculation Formula

The following formula is used to calculate the months to payoff your debt.

Months to Payoff = log(Monthly Payment / (Monthly Payment - (Total Debt * Monthly Interest Rate))) / log(1 + Monthly Interest Rate)

Variables:

  • Total Debt is the total amount of debt owed ($)
  • Monthly Payment is the amount paid towards the debt each month ($)
  • Monthly Interest Rate is the annual interest rate divided by 12 (%)

To calculate the months to payoff, use the formula above with the appropriate variables.

What is Debt Repayment Calculation?

Debt repayment calculation involves determining the time required to pay off a debt based on the total amount owed, the interest rate, and the monthly payment amount. This calculation helps in financial planning and managing debt effectively.

How to Calculate Months to Payoff?

The following steps outline how to calculate the months to payoff using the given formula.

  1. First , determine your total debt, interest rate, and monthly payment.
  2. Next, convert the annual interest rate to a monthly interest rate by dividing by 12.
  3. Use the formula from above: Months to Payoff = log(Monthly Payment / (Monthly Payment – (Total Debt * Monthly Interest Rate))) / log(1 + Monthly Interest Rate).
  4. Finally, calculate the months to payoff by plugging in the values.
  5. After inserting the variables and calculating the result, check your answer with the calculator above.

Example Problem:

Use the following variables as an example problem to test your knowledge.

Total Debt = $20,000

Interest Rate = 6%

Monthly Payment = $400

FAQ

1. What is total debt?

Total debt is the sum of all outstanding debt balances.

2. How is the monthly interest rate calculated?

The monthly interest rate is calculated by dividing the annual interest rate by 12.

3. How often should I use the debt calculator?

It’s helpful to use the debt calculator whenever there’s a change in your debt balance, interest rate, or if you want to plan your debt repayment more accurately.

4. Can this calculator be used for different types of debt?

Yes, you can use this calculator for different types of debt by adjusting the total debt, interest rate, and monthly payment fields accordingly.

5. Is the calculator accurate?

The calculator provides an estimate of your months to payoff based on the inputs provided. For exact figures, it’s best to consult your loan statements or financial advisor.