JavaScript is required for our calculators. Guides, glossary, and other content are still available below. For the full experience including interactive calculators, please enable JavaScript in your browser and reload the page.

Interest saved calculator

Compare paying the minimum versus paying a little extra every month — see the interest and months saved on any fixed-rate debt.

Logic updated April 2026

This calculator requires JavaScript

Please enable JavaScript in your browser settings and reload this page to use the interactive calculator.

This calculator compares paying a single debt at the minimum payment only versus minimum plus a fixed extra amount every month. It reports the interest saved and the months saved, so you can see exactly what trading discretionary spending for extra debt repayment buys you in dollar and time terms.

How this is calculated

Formula

Each month: balance += balance × rate/12 ; balance −= payment ; loop until balance = 0 ; comparison: (interest at minimum) − (interest at minimum + extra)

Step-by-step

Simulate the debt at the minimum payment: each month accrue interest at (annual rate / 12), then deduct the minimum payment from the balance
Continue until the balance reaches zero, capping the simulation at 600 months
Record total months and total interest paid under the minimum-only scenario
Repeat the simulation with minimum + extra payment each month — the higher payment kills principal faster, reducing future interest
Cap the final-month payment at the remaining balance to avoid overpayment
Compute interest saved (minimum-only interest − accelerated interest) and months saved (minimum-only months − accelerated months)

Rounding mode: ROUND_HALF_UP
Precision: 20-digit internal precision (Decimal.js), rounded to 2 decimal places for display
Logic last reviewed: 2026-04-30

Assumptions & limitations

What this calculator assumes

Debt accrues interest monthly at the stated annual rate
Minimum payment is fixed for the life of the debt (does not shrink with balance)
Extra payment is made consistently every month
Final-month payment is capped at the outstanding balance
Simulation is capped at 600 months (50 years) to bound analysis

What this calculator doesn’t account for

Does not model balance transfers, rate changes, or promotional rates
Does not include any new charges or principal additions during the payoff
Does not factor in early-payout penalties on fixed-term loans
Does not model the opportunity cost of the extra payment (what else could that money do?)
Single-debt only — for multiple debts, use the snowball, avalanche, or debt-free date calculators

Worked example

A borrower has a $15,000 credit card balance at 19% APR with a fixed $400 monthly minimum. They consider adding $200 a month.

Input	Value
Balance	$15,000
Interest rate	19%
Minimum monthly payment	$400
Extra payment	$200/month

Minimum only: ~52 months, ~$5,500 interest. With $200 extra: ~31 months, ~$3,000 interest. Saved: 21 months, ~$2,500 interest.

Each month at $400 only, about $238 goes to interest (month 1) and $162 to principal — slow progress. Adding $200 brings the monthly payment to $600, of which the principal share is now $362 — more than double. The balance falls roughly 60% faster, and because interest is calculated on a smaller balance every subsequent month, total interest drops by more than 45%. The $200/month extra ($6,200 over 31 months) returns $2,500 in interest savings — a 40% return on the deferred discretionary spending.

Frequently asked questions

How much interest can extra payments save?

It depends on the rate, balance, and term — but the saving is usually larger than people expect. A typical pattern: an extra payment of 25–30% on top of the minimum saves 40–60% of the total interest and cuts payoff time by a similar percentage. The reason is compounding in reverse — every dollar of principal you kill early stops earning interest for the bank on every future month.

Does it matter which debt I pay first?

On a single debt this calculator can't answer that — but for multiple debts, yes. Paying the highest-rate debt first (avalanche) minimises total interest. Paying the smallest balance first (snowball) maximises early wins for motivation. Both beat paying minimums on everything. Use the snowball or avalanche calculator for the multi-debt picture; use this one to size the extra payment for one focal debt at a time.

Lump sum vs regular extra payments?

A lump sum applied early (e.g. a tax refund or bonus) saves more interest than the same amount split into monthly extras, because the principal reduction starts working immediately. But the total saving from regular extras over the life of the loan is usually larger — they keep adding pressure month after month. If you have both options, pay the lump sum now and continue with monthly extras.

When is paying off debt not worth it?

When the after-tax interest rate is meaningfully below alternative uses of the money. If you have low-rate debt (under 5%) and an emergency fund, investing or saving at 6–8% may produce more wealth than extra debt payments. For high-rate debt (15%+), the math almost always favours payoff because no risk-free investment beats that rate. Use this calculator's interest-saved figure as the 'return' for comparison.

What if I can't afford to pay extra every month?

Even sporadic extras help — a one-month bonus added to a credit card balance shaves months off the schedule because that extra principal stops accruing interest forever. The calculator uses a constant monthly extra, but you can model irregular extras by averaging — if you add $1,200 once a year, that's equivalent to $100/month of extra. The simulation isn't perfectly accurate that way but it gets the order of magnitude right.

Embed this calculator

Add this calculator to your website. Free to use with attribution.