This loan calculator shows how quickly you can get out of debt
Americans' credit card debt spiked last year as consumers tried to stay afloat amid high inflation and rising interest rates.
Total credit card debt in the U.S. surged to a record $930 billion at the end of 2022, according to TransUnion's latest quarterly report.
Nearly half of consumers say that inflation and rising costs caused their credit card debt to grow, according to Bankrate's latest poll. And just over 30% say their debt grew because of rising interest rates, which can make credit cards more expensive to pay off.
If you're trying to pay down what you owe or planning to take on new debt, CNBC Make It's loan calculator can help you estimate your monthly payment, how long it will take to pay off the debt and how much you'll pay in interest.
It can also give you an idea of how much money you could save by paying more than the minimum each month if you can afford to do so.
For loans with a set time horizon, such as a personal loan or car loan, enter the full amount of the loan into the calculator, as well as the term length and interest rate.
For credit card debt, enter your credit card balance and interest rate. From there, you can play around with various timelines to see how much your monthly payment would change depending on how long it takes to pay off the debt.
How to start paying down credit card debt
Two of the most common debt payoff methods are the snowball method and the avalanche method.
With the snowball method, you prioritize paying off your smallest balances first and gradually work your way up to paying down your larger balances. The early wins you get from paying down smaller balances can motivate you to keep working toward paying down larger ones, financial experts say.
With the avalanche method, you focus on chipping away your most expensive debt first, which is the one with the highest annual percentage rate (APR). Then you'll work your way down to paying off the debt with the lowest APR.
Some financial experts prefer the avalance method because you'll pay fewer overall interest charges in the long run.
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