# Accelerated Debt Payoff Calculator

This calculator will demonstrate just how much time and money you could save by paying off your debts with the “rollover” method. The rollover method work like this: once you pay off a smaller debt, the payment amount attached to the smaller debt is applied to the next larger debt. As each debt gets paid off, money rolls over to the bigger debts one-by-one.

In the fields provided, order your debts from smallest to largest. For each debt, include principal balance, interest rate, payment amount, interest cost, and the number of payments you have left. Once you’ve added as many as ten debts, provide a monthly dollar amount that you could add to your payoff plan.

Press CALCULATE, and you’ll receive compiled numbers associated to your debts. Most importantly, you’ll get a number that constitutes savings related to the accelerated payment plan. Press “Create Payment Schedule,” and a printable schedule will open in a new browser window.

Note: If you include your mortgage, please enter only the principal & interest portion of your monthly mortgage payment (don't include monthly tax and insurance portion).

 Entry Columns Calculated Columns # Creditor PrincipalBalance (\$) InterestRate (%) PaymentAmount (\$) InterestCost # of PmtsLeft 1 2 3 4 5 6 7 8 9 10 Enter a monthly dollar amount you can add to your debt payoff plan: Results PrincipalBalance InterestRate PaymentAmount InterestCost # of PmtsLeft Current totals: N/A ADP totals: N/A Time and interest savings from Accelerated Debt Payoff Plan:

## 7 Effective Strategies to Quickly Pay Off Debt

Debt is a four-letter word that nobody likes. One of the worst parts about debt is how quickly that you can sink into it. Unfortunately since credit cards, a mortgage, car payments, and school loans are all becoming a necessary part of life, debt can pile up much too easily. According to Debt.org, consumers in the United States have a combined total of 11.4 trillion dollars in debt. If you want to do your part to decrease this astronomical number and if you are trying to get out from under debt, here are seven effective strategies to quickly pay off your debt.

### Stop Creating Debt

The first thing that you need to learn how to do is stop creating new debt. If you continue to go further into debt, you will never pay it off. That black hole of debt will only get deeper and feel more suffocating. Try to stop creating new debt by trying these techniques for the next year:

• Stop using your credit cards

If you're someone who can't get your spending under control, especially when it comes to using your credit cards, you may need to cut them up and throw them away. Most people who spend too much money do so because it gives the feeling of instant gratification. When you decide to stop creating new debt, try to focus on the long-term benefits. If you do well, you will surprise yourself by how much money you save when you stop adding to your debt. The money that you would have paid in interest can now be used for necessary purchases or put into savings.

Credit seems completely harmless, but it usually comes with a hefty price. You pay for your credit by paying interest. If you have a credit card, chances are you have an annual percentage rate (APR). When you don't pay off your balance every month, your interest rate kicks in, and you must pay that along with the balance. You can avoid paying high-interest rates on your credit card by transferring the balance to a card with a lower APR.

Some credit cards allow you to transfer your balance without paying any interest for a certain amount of time, usually between 12 and 18 months. The key is to not charge more purchases on that credit card to which you have transferred the balance. You should set a goal to pay off the entire balance before interest starts getting charged. You will want to make sure to do your research and find the best card as some credit card companies charge a transfer fee.

Sometimes when you first take out a loan, you get charged a high-interest rate. This might be because of your credit rating or because it is the only interest rate that financial institution offers. You can often lower these high-interest rates by refinancing your mortgage, car loan, school loan, or personal loans. Many financial institutions run refinancing specials so that you can refinance your loans with a lower interest rate. When you lower your interest rates, your debt automatically decreases.

### Pay More Than the Balance Due

One way you can quickly decrease your debt, especially on things like your credit card and your loans, is to pay more than just the balance due. For instance, if you have a car payment where you owe \$350 a month, try paying \$400 a month instead. You will want to tell the lender that you want the extra \$50 applied to the principal.

The more quickly you pay off your principal, the less interest you will end up owing. Even by paying a bit more than the balance due towards your principal, you can lessen the length of your loan. The more you can pay, the more quickly you can pay it off. This works with credit cards as well when you pay more than the balance due.

### Use the Snowball Technique

This technique, made popular by financial guru Dave Ramsey, is an especially great technique to try if you are having trouble getting motivated to pay off your debt. When using this technique to pay off your debt quickly, the trick is to pay off the loan with the lowest balance first. The snowball technique works great if you have several loans that you are trying to pay off. Once you pay off your loan with the lowest balance first, you will more likely be motivated to pay off the rest of the loans.

When you owe money to various creditors, it is easy to feel like you are sinking in a sea of debt, and it's hard to get your head above the water. Once you see that you are able to pay off one of your creditors, you can start swimming toward your goal of getting the rest of them paid off.

### Use the Avalanche Technique

The avalanche technique is different from the snowball technique because you are trying to pay off the loan that has the highest interest rate first instead of the smallest balance.

This technique works best for those who are really motivated to get their debt paid off and are not afraid to do the math. This technique also works well if you have loans or credit cards that are accumulating compound interest. When you pay off the loan or credit card with the highest interest rate first, you will be saving money down the road because you will decrease the amount of interest that you would have paid on the high interest loan.

### Consolidate Debt

Another effective strategy for paying off your debt quickly, especially if you have a lot of loans, is to combine them. Oftentimes, you will be able to combine several of your high-interest loans into a new loan with a lower interest rate. Many banks and other financial institutions offer debt consolidation programs. There are two ways you can effectively do this with different types of debt:

• Credit cards: Transfer all of your credit cards that have a high-interest rate to a card with a lower interest rate or zero percent APR.
• Home equity loans or lines or credit: Because these loans or credit lines often offer lower interest rates, you can use equity in your home to pay down your credit card.

If you are easily overwhelmed by the number of bills you have and loans you are trying to pay off, debt consolidation might be the best bet for you.

Some people are in debt and honestly don't know where all their money goes. The problem is they just keep spending and keep using their credit card because they don't have a spending plan. If you aren't aware of how you are spending your money, chances are you will never be able to get out of debt.

It's not hard to keep track of your spending. All you need to do is write down every time you use cash, your debit card, or your credit card. If you need to, focus on tracking your spending for one week or one month first until you get the hang of it.

You can try to categorize your spending by figuring out how much money you've spent on gas or groceries, or what you've paid toward your monthly bills. Once you begin to see where your money is going, you can try to cut back on one area of spending. For instance, if you are spending too much on food, you might need to do something different to save money like skipping the morning latte, start using coupons, or only buying food when it is on sale.

• Keep all your receipts in one container, and sort through them at the end of the day or week.
• Stay committed to tracking your spending no matter how painful it gets.
• Remember to keep track of your online spending.
• Make sure to break everything down into categories.
• Be completely honest and include that \$3.29 you spent at the fast food drive-thru.
• Get the family involved to track their spending too.

If you truly want to change your spending habits, you have to realize that you can no longer hide how you spend your money. Once you see where your money is going, you will be able to set up a budget that works and start tackling your debt.

These are just seven strategies that will help you pay off your debt quickly and effectively. This is important to do because having less debt means you have a better credit rating. In addition, you can put more money into savings and retirement or your child's higher education fund, or you can have extra money to go on that much-deserved vacation. If you need another incentive for being debt-free, think about the huge weight that will get lifted off your shoulders so that you can stop worrying about money and start enjoying life.